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The Effect of Incentive Reforms Upon Productivity: Evidence from the Vietnamese Rice Industry

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  • H. Son Nghiem
  • T. Coelli

Abstract

In this study we use region-level panel data on rice production in Vietnam to investigate total factor productivity (TFP) growth in the period since reunification in 1975. Two significant reforms were introduced during this period, one in 1981 allowing farmers to keep part of their produce, and another in 1987 providing improved land tenure. We measure TFP growth using two modified forms of the standard Malmquist data envelopment analysis (DEA) method, which we have named the Three-year-window (TYW) and the Full Cumulative (FC) methods. We have developed these methods to deal with degrees of freedom limitations. Our empirical results indicate strong average TFP growth of between 3.3 and 3.5 per cent per annum, with the fastest growth observed in the period following the first reform. Our results support the assertion that incentive related issues have played a large role in the decline and subsequent resurgence of Vietnamese agriculture.

Suggested Citation

  • H. Son Nghiem & T. Coelli, 2002. "The Effect of Incentive Reforms Upon Productivity: Evidence from the Vietnamese Rice Industry," Journal of Development Studies, Taylor & Francis Journals, vol. 39(1), pages 74-93.
    • Handle: RePEc:taf:jdevst:v:39:y:2002:i:1:p:74-93
    DOI: 10.1080/00220380412331322671
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    Citations

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    Cited by:

    1. Tarp, Finn & Roland-Holst, David & Rand, John, 2003. "Economic structure and development in an emergent Asian economy: evidence from a social accounting matrix for vietnam," Journal of Asian Economics, Elsevier, vol. 13(6), pages 847-871, January.
    2. Brummer, B. & Glauben, T. & Lu, W., 2006. "Policy reform and productivity change in Chinese agriculture: A distance function approach," Journal of Development Economics, Elsevier, vol. 81(1), pages 61-79, October.
    3. Nguyen, Hoa-Thi-Minh & Do, Huong & Kompas, Tom, 2021. "Economic efficiency versus social equity: The productivity challenge for rice production in a ‘greying’ rural Vietnam," World Development, Elsevier, vol. 148(C).
    4. Kumar, Surender & Managi, Shunsuke, 2012. "Productivity and convergence in India: A state-level analysis," Journal of Asian Economics, Elsevier, vol. 23(5), pages 548-559.
    5. Shi‐Xiao Wang & Wen‐Min Lu & Shiu‐Wan Hung, 2020. "Improving innovation efficiency of emerging economies: The role of manufacturing," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 41(4), pages 503-519, June.
    6. Vu Hoang Linh, 2012. "Efficiency of rice farming households in Vietnam," International Journal of Development Issues, Emerald Group Publishing Limited, vol. 11(1), pages 60-73, April.
    7. Tae-Woong Yang & Joon-Ho Na & Hun-Koo Ha, 2019. "Comparative Analysis of Production Possibility Frontier in Measuring Social Efficiency with Data Envelopment Analysis: An Application to Airports," Sustainability, MDPI, vol. 11(7), pages 1-18, April.
    8. Thang, Le Chien & Rowley, Chris & Quang, Truong & Warner, Malcolm, 2007. "To what extent can management practices be transferred between countries?: The case of human resource management in Vietnam," Journal of World Business, Elsevier, vol. 42(1), pages 113-127, March.
    9. Jamasb, Tooraj & Pollitt, Michael & Triebs, Thomas, 2008. "Productivity and efficiency of US gas transmission companies: A European regulatory perspective," Energy Policy, Elsevier, vol. 36(9), pages 3398-3412, September.
    10. Ming‐Miin Yu, 2008. "Productivity Change and the Effects of the Enhancement of the Mass Transportation Programme on the Bus Transit System in Taiwan," Transport Reviews, Taylor & Francis Journals, vol. 28(5), pages 573-592, January.
    11. Koji Kubo, 2013. "Rice Yield Gap between Myanmar and Vietnam: A Matter of Price Policy or Public Investment in Technology?," Asian Journal of Agriculture and Development, Southeast Asian Regional Center for Graduate Study and Research in Agriculture (SEARCA), vol. 10(1), pages 1-24, June.
    12. Vu, Linh Hoang, 2012. "Vietnam’s Agricultural Productivity: A Malmquist Index Approach," MPRA Paper 94800, University Library of Munich, Germany.
    13. Valiyattoor, Vipin & Bhandari, Anup Kumar, 2020. "Outsourcing and firm performance nexus: An analysis using the conventional and panel double-bootstrap procedure," Research in International Business and Finance, Elsevier, vol. 54(C).

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