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Spatial Impact of Foreign Direct Investment on Poverty Reduction in Vietnam

Quynh Anh Do (), Quoc Hoi Le (), Thanh Duong Nguyen (), Vu Van Anh (), Lan Huong Tran () and Cuc Thi Thu Nguyen ()
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Quynh Anh Do: Faculty of Economics, National Economics University, Hanoi 10000, Vietnam
Quoc Hoi Le: Faculty of Economics, National Economics University, Hanoi 10000, Vietnam
Thanh Duong Nguyen: School of Banking and Finance, National Economics University, Hanoi 10000, Vietnam
Vu Van Anh: Faculty of Economics, National Economics University, Hanoi 10000, Vietnam
Lan Huong Tran: Faculty of Economics, National Economics University, Hanoi 10000, Vietnam
Cuc Thi Thu Nguyen: Faculty of Economics, Vinh University, Vinh 43000, Vietnam

JRFM, 2021, vol. 14, issue 7, 1-16

Abstract: In this study, we analyze the spatial effect of foreign direct investment (FDI) on poverty reduction in Vietnam. This study uses the provincial-level panel data and the fixed-effects regression and the spatial econometric model to investigate empirically the impact of FDI on poverty reduction in Vietnam. The study finds that FDI has contributed to poverty reduction not only directly but also indirectly through human capital. However, FDI has indirectly worsened poverty through international trade. In addition, empirical results from the spatial econometric model show that FDI tends to decrease poverty in provinces. Finally, the study has some policy implications to decrease the negative effects of FDI on poverty reduction in Vietnam.

Keywords: foreign direct investment (FDI); poverty reduction; Vietnam (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2021
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