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The pro-poor impact of non-crop livelihood activities in rural Vietnam: A panel data quantile regression analysis

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  • Tran, Tuyen Quang
  • Vu, Huong Van

Abstract

Using a household panel dataset for the 2008–2016 period, we analyze the heterogeneous effects of livelihood change on household well-being in rural Vietnam. We use an unconditional quantile regression (UQR) model with fixed effects to control for unobservable time-invariant household characteristics. We find that when a fixed-effects estimator is employed, households switching from a crop livelihood to any non-crop livelihood (e.g., livestock, wage-earning, nonfarm, private or transfer livelihoods) increase their per capita income and food consumption. However, the results from the UQR with fixed effects reveal a significant variation in the effect of such a switch in livelihood across various quantiles of well-being distribution, with a larger effect for poorer households. The income effect, however, tends to decline with higher quantiles and even turns negative with a switch to a wage-earning or public transfer livelihood for the better off. Notably, our study confirms the pro-poor impact of changing livelihood from crop to non-crop activities in rural Vietnam. Our research results also suggest that a mean regression approach that often assumes a homogeneous/mean effect of livelihoods on well-being, may miss some heterogeneity that is useful to researchers and policy makers.

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  • Tran, Tuyen Quang & Vu, Huong Van, 2020. "The pro-poor impact of non-crop livelihood activities in rural Vietnam: A panel data quantile regression analysis," Economic Analysis and Policy, Elsevier, vol. 68(C), pages 348-362.
    • Handle: RePEc:eee:ecanpo:v:68:y:2020:i:c:p:348-362
    DOI: 10.1016/j.eap.2020.10.005
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    7. Manh Hung Do & Trung Thanh Nguyen & Ulrike Grote, 2022. "Is land consolidation policy a solution for rice production and agricultural transformation in Vietnam?," TVSEP Working Papers wp-028, Leibniz Universitaet Hannover, Institute for Environmental Economics and World Trade, Project TVSEP.
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    More about this item

    Keywords

    Crop livelihood; Fixed effects; Pro-poor; Income; Unconditional quantile regression;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • P - Political Economy and Comparative Economic Systems
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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