Abstract
This study analyzes the sources of income inequality among ethnic minorities in the Northwest region—the poorest and highest inequality region of Vietnam. Using an analysis of Gini decomposition by income source, the results show that while agricultural income, notably crop income, considerably decreases income inequality, off-farm income sources (wage and non-farm self-employment incomes) are found to increase inequality. This can be explained that in comparison with other income sources, agricultural income is more equally distributed and the main income source for most poor households. However, off-farm income sources are more unequally distributed and flow disproportionately toward the better-off. The findings support the hypothesis that income diversification in non-farm activities results in either greater inequality if opportunities for these activities are skewed toward to the better-off or less inequality if such opportunities are accessible to the poorer part of the population.
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Notes
The Gini (income) for the whole country is 0.397 in 2002 and 0.391 in 2012. The corresponding figures for urban areas are 0.399 in 2002 and 0.365 in 2012, and those for rural areas are 0.358 and 0.383 (McCaig et al. 2015).
The mean value of crop income (both unconditional and conditional on participation) earned by the poor and extremely poor is smaller than that received by the non-poor (Table 2).
Author’s own calculation form NMBS shows that the Gini index for agricultural land is 0.59 while that for labor (working age members) is only 0.24.
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The author thanks Vietnam National University, Hanoi and VNU University of Economics and Business for funding this research. The author also thanks colleagues for their helpful comments on earlier versions of the paper.
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Appendix 1: Map of the Northwest region, Vietnam
Appendix 1: Map of the Northwest region, Vietnam
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Tuyen, T.Q. Income sources and inequality among ethnic minorities in the Northwest region, Vietnam. Environ Dev Sustain 18, 1239–1254 (2016). https://doi.org/10.1007/s10668-015-9700-8
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DOI: https://doi.org/10.1007/s10668-015-9700-8