VIETNAM DEVELOPMENT FORUM

social issues under
economic transformationand integration in vietnam

Volume Two

Edited by:
Giang Thanh Long

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social issues under
economic transformationand integration in vietnam

Volume Two

Edited by:
Giang Thanh Long

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Publication of this volume was supported by the 21st Century Center of
Excellence (COE) Program of Japan's Ministry of Education, Culture, Sports,
Science and Technology (MEXT).
Ó Vietnam Development Forum, 2007
All rights reserved. No part of this publication may be reproduced or translated
into another language in any form or by any means, including photocopy or
website uploading, without permission in writing from the Vietnam
Development Forum.
The responsibility for facts and opinions expressed in this publication rests
exclusively with the authors, and their interpretations do not necessarily reflect
the views or policy of the Vietnam Development Forum, and other institutions
and individuals mentioned in this publication.
Printing 500 copies, 16x24cm. Publication Permit No. 433-2007/CXB/04-84/L§XH
by the Publishing House of Social Labour, issued on 15 October 2007

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CONTENTS

About the Authors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .i
Acknowledgements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .iii
Chapter 1

Introduction and Summary
Giang Thanh Long . . . . . .1

Chapter 2

Growth, Equity, and Poverty Reduction in Vietnam:
Prospects and Challenges
Raghav Gaiha and Ganesh Thapa . . . . . .7

Chapter 3

From Infrastructure to Institutions: Reforming
Primary Health Care in Vietnam
Scott Fritzen . . . . .51

Chapter 4

Between Nurturing and Nurtured Childhood:Children Working in the Streets in Hanoi
Aiko Takai . . . . .87

Chapter 5

Social Protection for Internal Migrants in Vietnam
Pham Quynh Huong . . . .123

Chapter 6

Patterns and Determinants of Living
Arrangements of the Elderly in Vietnam
Giang Thanh Long and Wade Donald Pfau . . . .147

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ABOUT THE AUTHORSAIKO TAKAI is an independent researcher in Tokyo, Japan. She holds
a master's degree in international development from the International
School of Humanities and Social Sciences, University of Amsterdam(the Netherlands). Her particular research interests include children's
rights, agency, and livelihoods, especially in Vietnam.
GANESH THAPA is a regional economist at the Asia and the Pacific
Division of the International Fund for Agricultural Development
based in Rome, Italy. He has also worked as the country director/program
leader for Winrock International in Nepal, and as a senior economist
for the Ministry of Agriculture, Nepal. He has undertaken researchand published various articles and papers on such topics as risks,vulnerability, and poverty reduction; sustainability of microfinance;
indigenous people and poverty reduction; effects of new agricultural
technologies on income distribution; constraints on agricultural
marketing; and food security and environmental policies. He holds aPh.D degree in agricultural economics from Cornell University (USA).
GIANG THANH LONG is a lecturer of the Faculty of Economics,
National Economics University in Hanoi, and a researcher at VDF.
His main research interests are social security, poverty, demographic
changes, and pension reform, particularly in Vietnam. He has
published various articles and research papers on these themes. He
earned a master of public policy (MPP) degree from Hitotsubashi
University (Japan). In 2005, he held a visiting research fellowship at
the Oxford Institute of Ageing, the University of Oxford, to work on
aging and pension reform in Vietnam.
PHAM QUYNH HUONG is a researcher at the Department of Urban
Sociology, Institute of Sociology of the Vietnam Academy of Social
Sciences. Her research interests include urban poor; migration;community participation in urban planning, industrial pollution
management, and water resources management; housing finance forlow-income households; residents' accessibility to the public services
in urban areas; and reproductive health of the youth. She earned amaster's degree in population and social research from Mahidol
University (Thailand).

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RAGHAV GAIHA is a professor of public policy at the Faculty ofManagement Studies, University of Delhi, and is currently a visiting
scholar at the Harvard Center for Population and Development
Studies. He has held visiting fellowships at Harvard University, Yale
University, Massachusetts Institute of Technology, Stanford
University, University of Pennsylvania, University of Cambridge, and
the World Bank. He has served as a consultant with the Food andAgriculture Organization (FAO), the International Fund for
Agricultural Development (IFAD), the Asian Development Bank
(ADB), the UK Department for International Development (DFID),
and the World Institute for Development Economics Research(WIDER). His research interests are in the areas of poverty, nutrition,
infant mortality, institutions, and natural disasters. He has published
his work in scholarly journals including Economic Development andCultural Change, Journal of Development Economics, Journal of
Development Studies, Cambridge Journal of Economics, and Oxford
Development Studies.
SCOTT FRITZEN is an assistant professor at the Lee Kuan Yew Schoolof Public Policy, National University of Singapore. He specializes in
the analysis of governance reform and capacity strengthening indeveloping countries. His current research focuses on the comparative
analysis of anti-corruption strategies, public sector decentralization,and social policy reform in Southeast Asia. In his active consulting
practice since 1994 in Southeast Asia, he has been involved in over 30
assignments most of them as team leader for clients including theWorld Bank, United Nations Development Programme, and Oxfam.
He holds a Ph.D degree in Public Affairs from the Woodrow Wilson
School of Public and International Affairs, Princeton University (USA).
WADE DONALD PFAU is an associate professor at the National
Graduate Institute for Policy Studies in Tokyo, Japan. He earned aPh.D degree in economics from Princeton University (USA). His
main research interests are related to social security, pensions, and theeconomics of aging. Particularly, he is working to develop methods tobetter analyze the future outcomes of defined contribution pension
programs. He has published a number of articles and papers on thesefields in scholarly journals. His recent research focuses on economic
and social welfare in Vietnam, especially remittances, poverty,
income distribution, demographic changes, and pension reform.

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ACKNOWLEDGEMENTS

This second volume of Social Issues Under Economic
Transformation and Integration in Vietnam is a collection of papers
prepared by VDF staff as well as by outside researchers. Earlier versionsof these papers were presented in workshops and conferences in different
countries. On behalf of the authors, I would like to thank all the institutions
and individuals, which are too numerous to list here, for their kind andenthusiastic support. Without such support, VDF could never have produced
this volume.
At the Vietnam Development Forum (VDF) in Hanoi, I am
grateful to Professor Kenichi Ohno, a professor of the National Graduate
Institute for Policy Studies (GRIPS) and the research director of VDF on
the Japanese side, as well as Professor Nguyen Van Thuong, the Rectorof the National Economics University, Hanoi, and the research director
of VDF on the Vietnamese side, for providing excellent support inall stages of the work. I also would like to thank VDF's researchers,
particularly Dr. Pham Hong Chuong, the general manager of VDF, fortheir encouragement and support in producing this volume. Ms. Vu Thu
Hang and Ms. Duong Kim Hong are acknowledged for their support inproofreading for this volume.
Many people from GRIPS also contributed greatly to thecompletion of this volume. I am grateful to Professor Donna Amoroso
and Ms. Patricia Decker of the Academic Writing Center for their
excellent and timely editing. I am also thankful to all the assistants of the
VDF-Tokyo and GRIPS Development Forum, especially Ms. Azko
Hayashida, Ms. Asuka Suzuki, and Ms. Nguyen Thi Xuan Thuy, for theirtireless assistance in related administrative work.
Finally, I would like to express my gratitude to all the authors
for their excellent contributions. It is my hope that the results of theiriii

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diligent work will benefit both academic research and social policy
discussions in Vietnam, thereby helping the country address thechallenges that accompany its economic and social changes.
Giang Thanh Long
(Editor)iv

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Chapter 1
Introduction and Summary
Giang Thanh Long

To continue disseminating important information to policy makers
and researchers, as well as people who are interested in the developmentof Vietnam, this second volume of Social Issues Under Economic
Transformation and Integration in Vietnam addresses another set ofsocial issues that emerge as a consequence of economic development andsocial reforms. As with the first volume, we hope that the contents of thisvolume will extend beyond those directly involved in the related field of
research, and that the book will provide crucial analyses on the current
development of Vietnam's social sector.
Five papers or chapters comprise this volume, each dealing witha social issue in Vietnam under economic transformation and integration.
These papers were revised in light of comments made at workshops andconferences held in many institutions in different countries. Following
are summaries of these chapters.
The contribution by Raghav Gaiha and Ganesh Thapa in
Chapter 2 provides an evaluation of prospects and challenges of growthand poverty reduction in Vietnam since Doi moi. Their estimates showthat Vietnam has recorded impressive economic growth and has rapidly
integrated into the regional and global economies. For instance, theaverage growth rate of gross domestic product (GDP) and GDP per
capita during 1987-2004 were about 7.4 percent and 5.7 percent,respectively. Along with this growth process, agriculture has played an
important role. According to the authors, such achievements were due tothe comprehensive reform programs, such as decollectivization of land,1

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Giang Thanh Long

dismantling of barriers to production, and freeing up of the agricultural
terms of trade. Such reform policies have benefited many groups of people
in Vietnam, which in turn led to a continuous and impressive poverty
reduction from 58 percent in 1993 to 29 percent in 2002. Vietnam also
emerged as an early achiever in a majority of the Millennium
Development Goal targets, according to the evaluation of the Economic
and Social Commission for Asia and the Pacific (2006). However,Vietnam's potential for further achievements may be constrained by risinginequality between areas and regions, slackening poverty reduction, andweak and ineffective social safety nets. Based on these analyses, theauthors propose policy directions for the coming years. These
recommendations emphasize institutional innovation and agriculture
reforms through various channels.
Chapter 3, written by Scott Fritzen, focuses on the reform of the
primary health care system in Vietnam by examining the attempt torebuild and reequip several thousand community health centers (CHCs)
in the late 1990s. By constructing a range of indicators based on the datafrom the Vietnam National Health Survey and the author's own survey infour provinces, i.e., Son La, Quang Tri, Phu Yen, and Soc Trang, thepaper compares a matched sample of project and non-project healthcenters under three hypotheses on inputs, outcomes, and outputs. Using
different quantitative analyses, the paper finds that significant investments
in infrastructure resulted in marginal increases in the utilization and thequality of services in these CHCs. However, as also pointed out in thefindings, a large number of the CHCs are failing to provide a
sufficient quality of service or increase utilization to their intended
beneficiaries, who are mainly ethnic minorities and poor people. A serious
equity problem thus emerges. According to the author, policy measureson the incentives and pressures faced by CHC staff and local authorities
are extremely important for dealing with this problem. In addition tothese suggestions, the author also emphasizes the importance of effective
institutional arrangements for decentralization in the health care sector,
as well as effective investments for further protecting and developing the2

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Introduction and Summary

quality of preventive service activities. The author anticipates that,having met the "first generation" of challenges (extending health services
to reach rural people) and the "second generation" of challenges (improving
quality of various supply-side factors in disadvantaged areas throughsignificant investments), Vietnam is now facing the "third generation" ofchallenges, which include moving toward decentralized planning andfinance in the health sector, boosting the access of poor people to healthcare services, and improving the institutional environment to achieve better
performance in local health care systems.
Addressing one of the most pressing social issues in urban
areas, Chapter 4 by Aiko Takai analyzes the real childhood of children
working in the streets with information from case studies conducted in
Hanoi in 2005. The paper first observes the differences in physicalcharacteristics, daily activities, as well as wishes for the future between
wealthy and poor children. It is shown that the former enjoy significantly
higher living standards, and have more ambitious aspirations than thelatter. The real lives of the poor children are then further explored by theauthor's interviews with the children working in the streets in Hanoi.
Although these children come from different families in different areas,
the two main reasons for most of them to work are the current poverty of
their families and their feeling of familial duty to help the families
overcome this situation. However, as the author argues, there are also two
main tensions that these children are facing in their working lives:
government policies to control street children, and parental expectations
to mitigate poverty. Providing some examples from the survey, the author
indicates that such tensions make the daily lives of these children, which
are inherently difficult, become even more difficult. Although the author
admits some obvious limitations in analysis due to a limited sample andlimited time, one of the most important messages of this chapter is thatchildren working in the streets are not a homogenous group, and theirlives are frequently affected by numerous constraints, and therefore policy
measures concerning these children should be carefully considered totake into account their diverse situations.

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Giang Thanh Long

Another emerging issue involved in the urbanization accompanying
Vietnam's economic development is internal migration from rural tourban areas. In Chapter 5, Pham Quynh Huong presents her analysis on
the current situation of the internal migrants and their access to theformal social protection system in Vietnam. Beginning with a SWOT
(strengths-weaknesses-opportunities-threats) analysis, the author showsthat the demand of internal migrants for access to the social protection
system is justified, as they have to struggle to make a living in the urban
areas while enduring insecure living conditions. The paper then provides
a more detailed analysis on the current accessibility for internal migrants
to the social services in urban areas, such as education, health care, housing,
vocational training, and loans and credit. According to the author, theaccessibility for internal migrants to such services is extremely low dueto their own characteristics and the current administrative regulations inurban areas. For instance, migrants usually have low levels of professional
skills, weak social networks, and saving-induced behaviors, which inturn lead them to work and live in deficient conditions. At the same time,
the current regulations and limited capacity in urban management,
including resident registration requirements and obsolete views on
migrants, are causing numerous difficulties for migrants to access these
services. From these discussions, the paper proposes some policy measures
to improve the accessibility of the social protection system for internalmigrants. These measures include conducting macroeconomic measures
to promote rural development; encouraging the business sector
to provide further protection for laborers, especially migrants; andstrengthening the role of other stakeholders such as urban communities
and non-governmental organizations.
Focusing on the elderly population, Chapter 6 by Giang ThanhLong and Wade Donald Pfau analyzes patterns of living arrangements ofthe elderly in Vietnam, and applies multinomial analysis techniques to
identify the determinants of such arrangements. The paper uses the datafrom the Vietnam Living Standard Surveys in 1992/93 and 1997/98 andthe Vietnam Household Living Standard Survey in 2002 and 2004. Their

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Introduction and Summary

findings show that, despite dramatic social and economic changes since
Doi moi, family structures in Vietnam have generally been maintained,as the proportion of elderly people living with their children has
remained high. Also, the decision of the elderly about whom to livewith depends on a number of characteristics of the elderly and theirhouseholds, such as age, gender, and marital status. For instance, theelderly at more advanced ages are more likely to live alone or with aspouse than their counterparts at younger ages. However, the paper also
points out some emerging worrisome trends in the living arrangements ofthe elderly over the past decade, such as a continuous decline in theelderly being supported by others (but not by their children), and aconstant rise in elderly people living alone. Such situations need to bethoroughly considered in social policy making processes.

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Chapter 2
Growth, Equity, and Poverty
Reduction in Vietnam:
Prospects and Challenges
Raghav Gaiha and Ganesh Thapa

Abstract
Vietnam recorded impressive growth during the 1990s, andagriculture played a key role in this achievement. Doi moi—acomprehensive reform program launched in 1986—marked the
beginning of the transition from a planned to a market economy.
Decollectivization of land, dismantling of barriers to production,and freeing up of the agricultural terms of trade benefited a vast
majority of the population, especially the rural poor whose
livelihoods were closely linked to subsistence agriculture. In fact,
Vietnam emerged as an early achiever in a majority of theMillennium Development Goal targets, including halving of
extreme poverty. Moreover, in the face of growing vulnerability tonatural disasters (e.g., extreme weather events), epidemics (e.g.,
SARS and avian influenza), and market volatility (e.g., fluctuating
primary commodity world prices), the Vietnamese economy has
shown remarkable resilience. There is, however, concern that
agricultural growth is slowing down, inequality is rising, andpoverty reduction is slackening.

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Raghav Gaiha and Ganesh Thapa

Acknowledgements
This paper was prepared under the guidance of Thomas Elhaut.
His advice and support at all stages were valuable. Discussions with Anil
Deolalikar, Pasquale Lucio Scandizzo, Purushottam Mudbhary, andKatsushi Imai are greatly appreciated. The present version has also
benefited from constructive editorial suggestions from Giang Thanh Long.
The econometric analysis was carried out competently by Raj Bhatia.
The views expressed here are personal and are not necessarily
those of the institutions with which the authors are affiliated.

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

1. Introduction
Vietnam recorded impressive growth during the 1990s, andagriculture played a key role in this achievement. The overall growth rate
was 7.5 percent per annum and the agricultural growth rate was 4.2
percent during 1990-2003 (FAO, 2006). Doi moi—a comprehensive
reform program launched in 1986 - marked the beginning of the transition
from a planned to a market economy (see, for instance, Van de Walle andCratty, 2003; Pritchett, 2002; Fritzen, 2002; World Bank, 2004, 2006;
and FAO, 2006). Decollectivization of land, dismantling of barriers to
production, and freeing up of the agricultural terms of trade benefiteda vast majority of the population, particularly the rural poor whose
livelihoods were closely linked to subsistence agriculture. There is,however, concern that agriculture alone will not be able to sustain arapidly growing population. In a densely populated agrarian economy,
land parcels are small and fragmented. Growing land scarcity andlabor-saving technology create fears of rising unemployment, andagricultural exports face less favorable global conditions than those in
the past. So, while opportunities exist for productivity gains, there isconcern about agriculture's employment generation possibilities.
Expansion of non-farm employment opportunities is thus vital forsustaining growth, living standards, and poverty reduction. If the burst ofpoverty reduction experienced over the period 1993-1998 (from 58
percent to 37 percent—a reduction of 20 percentage points) is maintained
over the next 10-15 years, Vietnam will change from being one of thepoorest countries in the world to one with negligible levels of absolute
poverty (Fritzen, 2002).1 However, doubts about this prospect cannot be
set aside as poverty reduction slowed down markedly over 1998-2002.
1 As emphasised by Fritzen (2002), however, the sheer magnitude of absolute poverty is still highin Vietnam. A little over one-third of the population, about 25 million, fall below a dollar-a-day
poverty line and a large segment of the population is clustered just above it. So even a mild shock(e.g., a drop in international prices, flood, or cyclone) could trigger downward mobility. In theabsence of social safety nets, poverty spells may persist for a few years or more, depending on theethnicity and location of segments of the population affected by such shocks (Van de Walle,2004).

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Raghav Gaiha and Ganesh Thapa

Another major related but distinct concern is a sharp risein income inequality. Although estimates differ, the Gini coefficientof income distribution rose from 0.356 to 0.407 over the period
1995-2000.2 This has impeded poverty reduction and will continue to doso. No less worrying is the pervasiveness of socio-economic and regional
disparities, and their worsening in some respects. Some groups, notably
ethnic minorities constituting about 15 percent of the population, haveexperienced relatively modest gains in human capital, such as educational
attainments. A H'Mong woman's life expectancy in 1989 was close totwo decades less than the average for the Red River Delta or Southeast,and 16 years less than the 85 percent of Vietnamese who are ethnically
Kinh. Although no comparable estimates are available for more recent
years, life expectancy in eight "low human development" provinces witha large share of ethnic minorities was seven years lower than the national
average (NCSSH, 2001).These estimates in combination with the muchslower reduction in poverty in upland regions and minorities raise doubts
about the ability of ethnic minorities and upland regions to catch up
with others.
Disparities in human capital reinforce income inequalities. The
geographical concentration of poverty grew over the period 1993-1998,
with the Northern Uplands, Mekong Delta, and North Central Coastregions holding over 67 percent of the poor in 1998, relative to 55
percent in 1993. The concentration persisted but with a small reductionin the share of these regions over the period 1998-2002 (the share fell to
59 percent in 2002).3
The incidence of national poverty was 58 percent in 1993; 37
percent in 1998; 28.9 percent in 2002; and 19.5 percent in 2004. Therewas wide regional variation in 2003, with the headcount index ranging
from about 11 percent in the Southeast to 68 percent in the Northwest

2 Vietnam Living Standards Surveys (VLSS) show a small increase in income inequality (i.e., from0.33 to 0.354). For details, see UNDP (2001) and Fritzen (2002).
3 For details, see World Bank (2004).

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges(World Bank, 2004; FAO, 2006). The majority of the rural population
continues to be engaged in agriculture (about 62 percent in 2000-2004).
Large segments remain vulnerable to numerous daily hazards, such as
illness, crop and animal diseases, unfavorable climatic conditions, highly
volatile prices, and trade restrictions. Occasionally, and with greater
frequency, cyclones and floods destroy lives and livelihoods, and hopesof escaping poverty (Van de Walle, 2004).
How issues of poverty and inequality are dealt with in a rapidly
evolving market economy will determine how sustainable improvements
in living standards are. In the analysis that follows, some answers are given.
The remainder of the paper is organized as follows. We will firstreview the policy reforms and identify some priorities. This will befollowed by an analysis of these reforms on macro and sectoral indicatorsof growth and performance, and their role in Vietnam's impressive poverty
reduction in Section 3. In Section 4, we will provide an assessment ofachievements of the Millennium Development Goals (MDGs), especiallyhalving of extreme poverty by 2015, with a review of future prospects forpoverty reduction. Finally, some concluding remarks identifying specificareas of policy reforms and conditions for more inclusive growth will
be given.

2. Overview of Policy Reforms and Constraints
2.1. Policy Reforms
There were broadly two phases of policy reforms, in which thefirst consisted of dismantling of central planning (1986-1989), and thesecond related to building and strengthening of a market-oriented (1990
to the present) policy regime. A synoptic view of these phases of policy
reforms is given below.
Let us first review the dismantling of central planning. The firstphase was mainly concerned with industrial policy reforms, focusing
on greater autonomy of state enterprises and foreign investment.

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Raghav Gaiha and Ganesh Thapa

Resolution 10 in 1988 allowed long-term land lease (15 years) toindividual farm households, permitting them to make all investment,
output, and marketing decisions. It did not, however, confer tradable land
rights. A key feature of this land reform was its egalitarian nature. Landwas distributed in accordance with subsistence requirements, i.e., by the
number of household members and of different qualities. However,this meant large scale fragmentation of holdings (a household could befarming 15 different plots scattered across the village). Prices were
liberalized in 1989, and not only prices of goods (with a few exceptions)but also interest and foreign exchange rates were freed.
Some salient features of the second phase of policy reforms are
as follows, with a selective macro focus. In 1990, a two-tiered banking
system was formed, in which the State Bank of Vietnam (SBV) becamea central bank, and many of its departments were converted into
autonomous state-owned commercial banks, such as the Vietnam Bank
for Agriculture and Rural Development (VBARD).
In 1998, in response to the concern that this bank lent only towealthier farmers, the Bank for the Poor (BP) was established. BothVBARD and BP suffered because of their failure to mobilize deposits
due to interest rate policy. Some reforms occurred following the IMF
restructuring program in 2002. The Social Policy Bank was establishedin 2003 based on the former BP, but drawing upon a wider capital base.
In domestic trade, following the elimination of official pricefixing, the private sector has assumed a dominant role. In preparing for
its accession to the World Trade Organization (WTO), Vietnam has been
forced to eliminate export subsidies, improve hygiene standards, protect
intellectual property rights, and reduce tariffs. The nominal exchange
rate better reflects the relation between domestic and foreign currencies.
The external balance is subject to high volatility in the prices of primarycommodity exports but is protected by low external debt and short-term
capital inflow.
Let us now review agricultural policy reforms. A landmark
legislation was the Land Law of 1993. It allowed tradable land rights and12

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

ensured gender equity (the names of both husband and wife appear on
the land use certificate). The latter item is often violated. Also, in somecases, exorbitant rents have been charged (FAO, 2006). This law wasamended in 2001 to permit foreign investors to acquire land use rights,
and to promote consolidation of plots.
In 1996, the Law on Cooperatives was approved, clarifying
their role as service providers, within a legal framework. This led to aremarkable growth in the number of cooperatives after an initial phase ofrestructuring. Cooperatives are engaged mainly in irrigation, plant
protection, extension services, and seed and other input supplies.
Along with a reduction in the relative tax burden on farmers, thestate has also reduced its share of investment in agriculture. During
2000-2004, the share of public investment fell from 12.2 percent to 8.7
percent (FAO, 2006). This was offset by a quadrupling of credit tofarmers in the second half of the 1990s. However, this is likely tohamper productivity, as private investment cannot substitute for public
investment (the latter in principle finances production of public goods).
Also, this transfers risks of production to farmers.
2.2. Constraints on Agricultural Productivity
As a result of market liberalization, agricultural commodity
prices rose, farmers' profits grew, and agricultural growth accelerated.
Devaluation of the Vietnamese Dong (VND), a substantial reduction inagricultural tax, and promotion of both domestic and foreign markets
further stimulated agricultural investment and growth. In recent years,
however, the profitability of agricultural production has declined, resulting
in a deceleration of productivity growth.
Agricultural growth through greater input usage, i.e., land,
labor, and fertilizer, seems to have run its course. Despite the extensionof cultivated land, the area available per worker fell from 0.43 ha to 0.37
ha over the period 1985-2000. Given that the rural environment is understress from extensive cultivation, continued expansion of area under13

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Raghav Gaiha and Ganesh Thapa

cultivation is not sustainable for long. Greater attention needs to be given
to more intensive use of these inputs.
The land reform that imparted security of tenure has also
become a constraint through land fragmentation. This gets in the wayof economies of scale and efficient use of labor and other inputs. A
considerable amount of land is wasted in bunds between different plotsof land. Consolidation, on the other hand, is likely to be controversial,depending on how best quality land is distributed.
While trade liberalization and foreign direct investment (FDI)
have helped accelerate overall and agricultural growth, some risks
associated with trade liberalization cannot be overlooked, especially fora large rice supplier such as Vietnam. As illustrated in FAO (2006),
during 1995-2004, the ratio of food export prices to raw material importprices declined. Specifically, the prices of rice and coffee declined. Inpart, it can be argued, these price movements are a consequence of thesuccess of reforms. Expansion of rice and coffee exports, especiallycoffee, have contributed to falling world prices. So while export volumes
have grown, unit values have declined and costs remain high.
An option is to improve the quality of Vietnamese rice andcoffee exports. While Thailand exports perfumed rice to developed
countries, Vietnamese exports cater to the less demanding markets indeveloping countries of Southeast Asia, the Middle East, and Africa.
Also, Vietnam exports lower value Robusta coffee (as compared to thehigh value Arabica). For quality to improve, the private sector has toinvest in new varieties, technologies, and better processing facilities inrice and coffee growing areas.
Comparative advantage of agricultural production across different
regions also varies greatly. The Red River Delta and the Mekong River
Delta are far ahead of the other regions, followed by the Southern Central
Coast and Southeastern regions. The three mountainous regions and theNorthern Central Coast lag far behind.4 Infrastructural development and
4 Out of the five commodities (rice, coffee, tea, pork, and cashew nuts), only one (pork) had adomestic resource cost of greater than unity, implying lack of competitive advantage. For detailsof estimates, see FAO (2006).

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

easier access to new technologies would impart greater competitivenessto agricultural production as well as reduce inter-regional disparities.
Regions with high proportions of non-farm wage labor are also
the ones which have experienced high rates of reduction in rural poverty.
Incomes of households involved in non-farm activities are two to fivetimes higher than those of farm households (Nguyen, 2005). However,
not all wage labor in non-farm activities is poverty reducing, especiallywhen it is seasonal casual work and at a considerable distance fromhome. Some estimates point to low growth of the proportion of non-farmhouseholds over the period 1994-2001 (an annual increase of about 1.8
percent). At the regional level, the Northern Highlands, the Red River
Delta, and the North Central Coastal regions witnessed a marked spurt in
non-farm activities. This was linked to growth of traditional manufacturing
villages in this area, somewhat akin to township and village enterprises(TVEs) in China. The decline in the Mekong Delta and the Southeasternregions, on the other hand, was related to out-migration of households tourban areas, sharpening the urban-rural divide. Apart from credit expansion
and better infrastructure (e.g., easier access to markets), it is imperative
to expand vocational training, especially for women.5
2.3. Prospects
A recent assessment by ADB (2006) is optimistic. It rests on thefollowing arguments. First, improvements in the overall economic
environment and WTO membership are likely to spur strong investment,
and thus GDP growth is likely to accelerate to 8 percent per annum.
Second, implementation of commitments related to the Association ofSoutheast Asian Nations (ASEAN) and accession to WTO will expand
trade opportunities for Vietnam. Exports are likely to grow faster thanimports, narrowing down the trade deficit to 4.6 percent of GDP. Higher
flows of FDI will result in a surplus in the capital account. Third, an
5 An evaluation of credit projects for women showed that the outcomes would have been morefavorable if the women were simultaneously provided vocational training (FAO, 2006).

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Raghav Gaiha and Ganesh Thapa

expansionary fiscal policy is likely to widen the primary budget deficit.
Fourth, although the 2006-2010 socio-economic development plan
(SEDP) sets ambitious targets for achieving a wide range of goals,
including the MDGs, these are achievable, given the buoyancy of investment
and the private sector.
In our view, however, the constraining influence of agriculture
is overlooked. While a transformation is underway, technologicalupgradation, land consolidation, and better processing facilities would
help add value to agricultural production. Consolidation of agriculturalland, restructuring of state forest land, and supporting of community-based
land management among ethnic minorities require specific policies,
going beyond the issuance of Land Use Certificates (LUCs) (World
Bank, 2006). If our review has any validity, it calls for more cautious
optimism.
Table 1: Institutional Quality Indicators in Vietnam
Indicator
Voice and Accountability
Political Stability
Government Effectiveness
Regulatory Quality
Rule of Law
Control of Corruption

1996

2004

-1.31
0.40
-0.10
-0.56
-0.50
-0.64

-1.54
0.16
-0.31
-0.57
-0.59
-0.74

Note: Scores range from -2.5 to +2.5, in which -2.5 and + 2.5 are worst and best, respectively.

Source: Governance website of the World Bank.

This is further reinforced by dilution of institutional quality(Table 1). While the National Assembly passed a law in June 2006, providing
a legal framework for market operations, protection for investors, andcorporate disclosures and transparency, the agenda for governance has
to be broader and must encompass rural areas. Specifically, greaterattention needs to be given to (a) the on-going Programme of
Public Administration Reform and strengthening of the Vietnamese

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

Government's authorities and administration, (b) legislation on local
democracy, and (c) support to ethnic minorities and other vulnerable
groups.6

3. Macro and Sectoral Indicators
3.1. Macroeconomic Indicators
Let us first review the changes in some macroeconomic indicators,
followed by changes in those relating to agriculture.
Table 2: Growth Rate of GDP and GDP per Capita, 1987-2004
Variable
Growth Rate of GDP (%)
Growth Rate of GDP Per Capita (%)

1987-1996

1997-2004

1987-2004

8.27
6.14

6.41
5.11

7.38
5.70

Note: GDP (PPP constant 2000$).

Source: Computed from the World Development Indicators (WDI) 2006.

Following Doi moi and other subsequent reforms (e.g., the Land
Law of 1993), there was growth acceleration. During the first decade, theGDP growth rate was 8.27 percent per annum. The growth rate of GDP
per capita was also impressive, as it grew at over 6 percent per annum(Table 2). This growth acceleration was the result of a significant shift ineconomic policies from those that reinforced a poverty trap (exchange
rate overvaluation, hyperinflation, lack of incentives in the rural sector,
and severe limitations on the private sector) to a different set that could
support a higher level of economic activity. In fact, a disaggregation of
the policy experience, shown in Table 3, corroborates this story.
6 There is a case for simplification of procedures, so as to reduce the discretionary power ofgovernment officials, including electronic interfaces and other forms of e-government. The Law
on Corruption, approved in 2005, is another major step forward. It holds heads of agencies andorganizations responsible for the prevention and control of corruption. Besides, the judicial
reforms approved would improve criminal and civil policy and legislation, and the oversight roleof elected bodies (World Bank, 2006).

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Raghav Gaiha and Ganesh Thapa

Table 3: Policy Experience in Vietnam
PeriodAnnual Growth of
GDP Per Capita

Policy Environment

1976-1981

Unification of country, nationalizationindustry, collectivization of farms in the Southofprivate1981-1986

Second Five-year Plan, some relaxation of controls in rural areas,
introduction of "contract system," but no announced reform path

5.86

1986-1988

Doi moi, with economic stabilization
Doi moi, with economic stabilization; a major stabilization in

1.97

1988-1997

1989 included exchange rate unification, abolition of dual pricesystem, and reduction of quotas and tariffs

5.85

-0.67

1997-1999 East Asian crisis; spillover effects dampen growth

3.40

Source: Pritchett (2003).

The devastation of the war and the rigidity of the regime had
weakened the economy, and a severe economic crisis followed efforts
towards immediate socialism. Policies were relaxed in a piecemeal
manner, but without any clear shift in policy direction. Nevertheless,even this modest relaxation of controls allowed some growth. The growth
eventually dwindled, and in 1986 the Sixth Congress, while remaining
committed to socialism, announced a new direction that allowed
a multi-sectoral approach (a mix of public and private sectors).
Implementation of these reforms was weak until an agricultural crisis in
1989 precipitated drastic reforms. The package of reforms, including Doi
moi, decollectivization of land, and freeing of prices, was enormously
successful, and created rapid growth. These reforms were designed tosustain a much higher level of output within the same political andnstitutional regimes. The qualitative change is aptly summed up by
Pritchett (2003), i.e., who the government is and what it tends to do weregenerally not in dispute.
However, our analysis indicates that the dampening of growth
in recent years raises serious concerns about its sustainability andcontinued progress in achieving the MDGs by 2015.

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

Table 4: Log of GDP and GDP per Capita
lgdp

Coefficientp-valuelgd_pcCoefficientp-valuett2Constant

0.0403164-0.000285
10.48236

0.000
0.009
0.000

t
t2
Constant

0.265673-0.000088
2.788878

0.000
0.348
0.000

Number of observations = 16
F(2,13) = 3153.09
Prob > F = 0.0000
R-squared = 0.9979

Number of observations = 16
F(2,13) = 2007.46
Prob > F = 0.0000
R-squared = 0.9968

Note: GDP and GDP per capita are estimated by PPP constant 2000$; lgdp is log of GDP; and lgd_pc
is log of GDP per capita.

Source: Authors' estimates.

Figure 1: Log of GDP and GDP per Capita

Log of GDP per Capita

Log of GDP
11.4

3.45
3.4

11.3

3.35
3.3

11.2

3.25

11.1

3.2

11

3.15

10.9

3.05

3.1
3

10.8
1985

1990

1995
lgdp

2000
Poly. (lgdp)

2005

1985

1990
lgdp_pc

1995

2000

2005

Poly. (lgdp_pc)

Note: GDP (PPP 2000$)

Source: Authors' estimates.

There was a marked deceleration in GDP growth during
1997-2004. This is consistent with the quadratic term in the left panels ofTable 4 and Figure 1. Besides, although the coefficient of t2 in theestimation for the log of GDP per capita is negative, it is not significant(Table 4, right panel). This finding implies that the deceleration of GDP
per capita growth in recent years is not corroborated.

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Raghav Gaiha and Ganesh Thapa

Table 5: Share of Trade in GDP
tradepgdptt2
t3
Constant

Coefficientp-value

35.86049-1.900346
0.374917-155.9937

0.015
0.044
0.053
0.023

Number of observations = 19 F(3, 15) = 68.45
Prob > F = 0.0000 R-squared = 0.9319
Note: tradepgdp is the share of trade in GDP (%).

Source: Authors' estimates.
Figure 2: Share of Trade in GDP

160
140

Percent

120
100
80
60
40
20
0
1985

1990

1995
tradepgdp

2000

2005

Poly. (tradepgdp)

Source: Authors' estimates.

Similarly, the share of trade in GDP is approximated by a cubic timetrend, as shown in Table 5 and Figure 2, pointing to acceleration inrecent years.
Table 6: Share of Current Account Balance in BOP
cabop
t
t2
Constant

Coefficient
8.92e+09-2.13e+08-9.26e+10

p-value
0.053
0.060
0.047

Number of observations = 7 F(2, 4) = 7.14
Prob > F = 0.0479 R-squared = 0.7811
Note: cabop is the share of current account balance in BOP (%).

Source: Authors' estimates.

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

Figure 3: Current Account Balance (BOP, current US$)
1500
1000
US$ (million)

500
0
-500
-1000
-1500
-2000
-2500
-3000
1995

1996

1997

1998

1999

cabop (m)

2000

2001

2002

Poly. (cabop (m))

Source: Authors' estimates.

As the samples for both share of current account balance inbalance of payments (BOP) and of debt service in gross national income(GNI) cover relatively short spans, especially the former, we refrain fromdrawing definitive inferences (Table 6). Both variables, however, exhibit
non-linear trends. The share of current account balance is approximatedby an inverted U, with a decline from 2000 onward (Figure 3).
Table 7: Total Debt Service
debtpgni
Coefficientt-8.8983936
t2
0.5478512
t3-0.0106172
Constant
49.49943
Number of observations = 16 F(3, 12) = 7.24
Prob > F = 0.0050 R-squared = 0.6441

p-value
0.001
0.001
0.001
0.001

Note: debpgni is total debt service as percentage of gross national income (GNI).

Source: Authors' estimates.
Figure 4: Total Debt Service as Percentage of GNI
5.5
5
4.5
4
3.5
3
2.5
2
1.5
1
1989

1991

1993

1995
debtpgni

1997

1999

2001

2003

2005

Poly. (debtpgni)

Source: Authors' estimates.

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Raghav Gaiha and Ganesh Thapa

The debt service share declined during the early 1990s, rosein subsequent years, and declined after 2000 (Table 7 and Figure 4).
In sum, while the macro indicators (GDP, current accountbalance, and debt service) improved following the policy reforms, there
were signs of slowing down, which need to be considered for further reforms.
3.2. Agriculture Development
Let us consider some sectoral indicators. Agriculture is ofparticular importance because it still accounts for a little under a quarter
of GDP and about 62 percent of the total employment. The share of therural population declined only slightly over the period 1995-2004, from77.8 percent in 1995-1999 to 74.8 percent in 2000-2004 (Dang et al.,2006). The share of agriculture in GDP declined from about 41 percent
in 1987 to about 22 percent in 2004. Table 8 and Figure 5 describe thedecline in the share over time.
Table 8: Share of Agriculture in GDP
avpgdpCoefficientt5.559344
t2-0.5016245
t3
0.0112231
Constant
23.11162
Number of observations = 20 F(3, 16) = 50.47
Prob > F = 0.0000 R-squared = 0.9044

p-value
0.058
0.017
0.013
0.074

Note: avpgdp is value-added of agriculture as percentage of GDP.

Source: Authors' estimates.
Figure 5: Share of Agriculture in GDP
50
45
40
35
30
25
20
1985

1990

1995
avpgdp2000

2005

Poly. (avpgdp)

Source: Authors' estimates.

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

Both quadratic and cubic equations were fitted to the data, andthe latter approximates the data better. The share fell rapidly until 1994,
when it stabilized. The share then rose briefly, followed by a steadydecline. However, the cubic equation is likely to overestimate the sharein more recent years.
Table 9: Growth of Log of Agricultural VA and VA per hectare
lavc2000tt2
t3
Constant

Coefficient-.0.0078789
0.001542-0.0000298
9.642513

p-value
0.127
0.000
0.001
0.000

Number of observations = 20
F(3, 16) = 2696.29
Prob > F = 0.0000
R-squared = 0.9980

lavpaltt2

Coefficient
0.0269672-0.0004956

p-value
0.000
0.000

Constant

2.739937

0.000

Number of observations = 19
F(2, 16) = 451.54
Prob > F = 0.0000
R-squared = 0.9826

Note: VA (constant 2000$); lavc2000 is log of agricultural VA; and lavpal is log of agricultural VA
per hectare of arable land.

Source: Authors' estimates.
Figure 6: Log of Agricultural VA and VA per hectare
Log of Agricultural VA

Log of Agricultural VA per hectare

10

3.15

9.95

3.1

9.9

3.05

9.85
9.8

3

9.75

2.95

9.7

2.9

9.65
9.6
1985

2.85
1990

1995

lavc2000

2000
Poly. (lavc2000)

2005

1985

1990
lavpal

1995

2000

2005

Poly. (lavpal)

Source: Authors' estimates.

Let us now consider growth of agricultural value added(constant US$, year 2000). During the period 1987-1996, there wasacceleration of growth (from 2.94 percent per annum during 1980-1986
to 4.05 percent during 1987-1996), followed by a deceleration during
1997-2004. Over the entire period 1985-2004, agriculture grew at 3.69

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Raghav Gaiha and Ganesh Thapa

percent per annum. The growth rate is consistent with a cubic trend, as
shown in the left panels of Table 9 and Figure 6.
Similarly, agricultural value added per hectare of arable land(constant US$, year 2000) recorded an acceleration over the period
1987-1996 (about 4 percent relative to 3.84 percent in the previous
period) but plummeted later (to 1.23 percent per annum).7 Consequently,
the annual growth rate over the period 1985-2004 was unimpressive, atmerely 1.97 percent. This is shown in the right panels of Table 9 and
Figure 6. A quadratic time trend serves as a close approximation. Whileagricultural value added per hectare rose, it did so at a diminishing rate.
Table 10: Log of Livestock Production
llivestock

Coefficient
0.0493429-0.0024212
0.000064
1.42579tt2
t3
Constant

p-value
0.000
0.000
0.000
0.000

Number of observations = 25 F(3, 21) = 969.81
Prob > F = 0.0000 R-squared = 0.9928
Note: llivestock is log of livestock production.

Source: Authors' estimates.
Figure 7: Log of Livestock Production
2.2
2.1
2
1.9
1.8
1.7
1.6
1.5
1.4
1.3
1.2
1980

1985

1990
llivestock

1995

2000

2005

Poly. (llivestock)

Source: Authors' estimates.

7 As noted earlier, this was in large measure due to a sharp decline in the ratio of food export prices(e.g., rice and coffee) relative to raw material import prices (FAO, 2006).

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

Livestock production accelerated during 1997-2004, after
a sharp deceleration during 1987-1997, relative to 1980-1986. It isapproximated by a cubic time trend in Table 10 and Figure 7.

4. Impacts of Policy Shifts
In the analysis that follows, we comment on the results ofpolicy shifts at both macro and sectoral levels. The strategy followed
here is to identify specific policy changes and allow for a period of time
for their effects to manifest themselves. The effects of Doi moi, forexample, are sought to be captured through an intercept dummy thattakes the value 1 for 1986-1990, and 0 otherwise. Similarly, the effectsof the 1993 Land Law on both the agricultural and macro indicators(e.g., GDP) are analyzed through another dummy variable that takes
the value 1 for the period 1993-1996, and 0 otherwise. Whether thefinancial crisis of 1997-1998 in Southeast Asia had a contractionary
effect on the Vietnamese economy is examined through anotherdummy that takes the value 1 for 1997-1998, and 0 otherwise.
As the periodization of the effects of policy shifts requires
extensive experimentation with a long time series, we address thisconcern with a few experiments. The results of our analysis of policy
shifts must therefore be interpreted with care. Another reason forcaution is the omission of some key variables that matter in thetransmission of policy changes. Broadly, these relate to some institutional
indicators. Some recent studies, such as Acemoglu et al. (2001, 2002);
Rigobon and Rodrik (2004); Bardhan (2005); and Gaiha et al. (2006),
have shown empirically that policy reforms in a context of weakprotection of property rights, enforcement of contracts, political instability,
and rampant corruption are unlikely to lead to desired results in termsof growth acceleration and poverty reduction. The evidence on tradeliberalization is fairly robust. Contrary to the claims of trade theory,
without strong institutions, opening up of an economy fails toaccelerate growth.

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Raghav Gaiha and Ganesh Thapa

This issue is particularly relevant in analyzing Vietnam's
impressive growth experience and poverty reduction during the last
decade and a half. The transition to a market-oriented macro policy
regime, trade liberalization, decollectivization of agriculture, dismantlingof restrictions on production, and freeing up of the agricultural terms oftrade accelerated growth and poverty reduction. However, as shown
earlier, there are signs of a slowing down of growth and poverty
reduction. The possibility that this is linked to a decline in thegovernance/institutional indicators cannot be rejected, as some evidence
points in this direction. In any case, in the absence of these indicators,
the results reviewed below may change in a more complete specification.
However, experiments with alternative specifications, including alternative
periodization of effects of policy shifts, point to some regularities androbustness of the results.
4.1. Macroeconomic Results
Let us first consider the results in Table 11 below. What issomewhat surprising is that the coefficient of the dummy for theperiod 1986-1990 is not significant. This suggests that the initial phaseof Doi moi reforms did not have a favorable effect on GDP, controllingfor other changes. However, the coefficient of the second dummy (i.e.,
covering the period 1993-1996 and coinciding with the Land Law of1993 and agricultural reforms) is positive and significant. The third
dummy (covering the years of the financial crisis in Southeast Asia)
also has a significant positive coefficient, implying that the momentum
created by Doi moi and decollectivization of agriculture helped sustain
growth, despite the financial crisis in the Southeast Asian neighboring
countries. What is also important to note is that increase in the log ofarable land area (denoted as lal) had a significant positive effect on
GDP. As the expansion of arable land coincided with higher usage offertilizers, land productivity rose, and consequently GDP also
increased.

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

Table 11: Log of GDP and GDP per Capita
lgdp
year_d1
year_d2
year_d3lalConstant

Coefficient-0.0631459
0.0628498
0.1019496
3.571231-13.0928

p-value
0.149
0.081
0.015
0.000
0.001

Number of observations = 15
F(4, 10) = 37.20
Prob > F = 0.0000
R-squared = 0.9370

lgdp_pc
year_d1
year_d2
year_d3lalConstant

Coefficient-0.0432781
0.046926
0.0787566
2.776185-15.5782

p-value
0.194
0.089
0.015
0.000
0.000

Number of observations = 15
F(4, 10) = 37.13
Prob > F = 0.0000
R-squared = 0.9369

Note: GDP (PPP constant 2000$); lgdp is log of GDP; lgdp_pc is log of GDP per capita; year_d1,
year_d2, and year_d3 are dummy variables for the periods 1986-1990; 1993-1996; and 1997-1998,
respectively; lal is log of arable land.

Source: Authors' estimates.

In the right panel of Table 11, the same specification is
employed for the log of GDP per capita, and the results obtained aresimilar. What is interesting to note is that, even after the omission of thefirst dummy (representing the effect of the initial phase of Doi moi), thesignificant positive effects of the second and third dummies (associatedwith specific policy reforms) and of increase in arable land remain intact,
implying that these results are robust.

Table 12: Share of Trade in GDP
tradepgdp
year_d2
year_d3
Constant

Coefficient
34.83827
28.81929
48.95883

p-value
0.012
0.035
0.000

Number of observations = 19
F(2, 16) = 19.01
Prob > F = 0.0001
R-squared = 0.7038
Note: tradepgdp is share of trade in GDP (%); year_d2 and year_d3 are dummy variables for theperiods 1993-1996 and 1997-1998, respectively.

Source: Authors' estimates.

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Raghav Gaiha and Ganesh Thapa

Of considerable significance is trade-led growth in Vietnam,
especially through expansion of agricultural exports (FAO, 2006). It istherefore not surprising that the expansionary phases in Vietnam (i.e.,during most of the 1990s) also coincided with expansion of trade. This iscorroborated by the significant positive coefficients of the second andthird dummies in Table 12. The latter is somewhat surprising in view of
the crisis in some parts of Asia, but evidently Vietnam's major exports,
especially rice, rubber, and cashew nuts, recorded impressive gains.8
Vietnam is the world's second largest rice exporter and is among thelargest exporters of coffee. Growth rates in both the volume and value ofagricultural exports have been impressive over the past decade. Rice
exports have doubled in volume; rubber exports have more than tripled;coffee exports have quadrupled; and tea and pepper exports have grown
five-fold. In value terms, the growth has been less spectacular, particularly
for coffee, which faced falling world prices since 1997. Only in the caseof cashew nuts has the growth in value terms outstripped the expansion
in volume (FAO, 2006).
4.2. Sectoral Results
As discussed earlier, agriculture has played and continues toplay a major role in shaping the overall economic performance ofVietnam. This is also corroborated by the results in Table 13.

8 Agricultural exports have contributed significantly to Vietnam's overall economic performance.
In 1995, exports accounted for 31 percent of agricultural GDP, rising to 35 percent in 2001 and38 percent in 2003. The export value of agriculture, forestry, and fishery products increased by anaverage of 15 percent annually and accounted for about 30 percent of total exports (FAO, 2006).

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

Table 13: Log of Agricultural VA, VA per hectare, and VA per worker
lavc2000Coef.
p-value lavpal
Coef.
p-value lavpwk
year_d1 -0.039159 0.199 year_d1 -0.039160 0.199 year_d1
year_d2 0.060230 0.064 year_d2 0.060230 0.064 year_d2
year_d3 0.070971 0.053 year_d3
0.07097
0.053 year_d3
lal2.387670.000 lal
1.38769
0.003 lalConstant -6.37066
0.030 Constant -6.37064
0.030 Constant
Number of observations = 19
F(4, 14) = 20.68
Prob > F = 0.0000
R-squared = 0.8553

Number of observations = 19
F(4, 14) = 9.92
Prob > F = 0.0005
R-squared = 0.7392

Coef.
-0.01484
0.028023
0.037648
1.534268-7.99929

p-value
0.193
0.063
0.029
0.000
0.000

Number of observations = 19
F(4, 14) = 36.32
Prob > F = 0.0000
R-squared = 0.9121

Note: VA-value added (constant 2000$); lavc2000 is log of agricultural VA; lavpal is log ofagricultural VA per hectare; lavpwk is log of agricultural VA per worker; year_d1, year_d2, and
year_d3 are dummy variables for the periods 1986-1990, 1993-1996, and 1997-1998, respectively;
lal is log of arable land.

Source: Authors' estimates.

The second and third dummies have strong positive effects on
agricultural value added. Controlling for these effects, increases in arable
land are also associated with higher agricultural value added. The factthat the direction of their effects is similar to that for GDP suggests thatsome of the factors that stimulated agricultural growth were significant
enough to shape the overall performance of the Vietnamese economy.
Turning to a measure of land productivity, we find that asimilar pattern held. While the initial phase did not have a favorable
effect on land productivity, the subsequent phases did. Besides, expansionof arable land had a favorable effect. This might be a result of a concomitant
increase in the use of fertilizer (FAO, 2006).9
Another indicator of productivity is agricultural value added per
worker. Two points need to be borne in mind. One is the decline in theshare of agricultural employment (from about 71 percent in 1980-1984
to about 62 percent in 2000-2004). In fact, employment in agriculture

9 Fertilizer use increased from 469,200 tons in 1985 to 1,975,200 tons in 2002 (or a 321-percent
increase). Usage per hectare rose almost three-fold, from 70 to 207 kg over the same period (FAO,
2006).

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Raghav Gaiha and Ganesh Thapa(including forestry and fisheries) experienced a negative growth rate during
1999-2004 (-1.5 percent annually). So a rising agricultural value added
would show up as a rising agricultural value added per worker. A related
point is that, during the mid-1980s and subsequent years, fertilizer use
increased rapidly. As fertilizer was applied manually, intensity of labor
use was higher. Therefore, modernization of agricultural technology
manifests itself in both higher land and labor productivity.10
Table 14: Log of Livestock Production
llivestock
year_d1
year_d2
year_d3lalConstant

Coefficient
0.1275891
0.2445411
0.2419774
4.722546-30.2267

Number of observations = 24
F(4, 19) = 4.15
Prob > F = 0.0140
R-squared = 0.4660

p-value
0.179
0.019
0.041
0.002
0.003

llivestock
year_d2
year_d3lalConstant

Coefficient-p-value

0.3396353
0.349261
7.351514-48.09802

0.001
0.002
0.000
0.000

Number of observations = 24
F(3, 20) = 10.45
Prob > F = 0.0002
R-squared = 0.6106

Note: llivestock is log of livestock production; year_d1, year_d2, and year_d3 are dummy variables
for the periods 1986-1990; 1993-1996; and 1997-1998, respectively; year_d12 is dummy variable
for the period 1986-1996; and lal is log of arable land.

Source: Authors' estimates.

Other agricultural productivity indicators, such as cereal yields,
crop production, and food production indices, reproduce these patterns,
shown by significantly higher values during 1993-1996, and 1997-1998,
and a positive effect of expansion of arable land area (Table 14, left
panel). These indices, however, are not as informative as those based onvalue added primarily because the former do not adjust for changes in
inputs.11 The expansion of livestock repeats the pattern delineatedearlier. Diversification of agriculture went hand in hand with agricultural
10 The assertion of FAO (2006) that higher agricultural output due to fertilizer use is reflected not
so much in higher arable land productivity as in labor productivity is far from persuasive.
11 Details will be furnished on request.

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

growth. In this diversification, the important role of policy reforms was
accompanied by expansion of arable land (e.g., greater supply of fodder).
In an alternative specification in which the effects of Doi moi
are reinforced by that of the Land Law of 1993 and further liberalizationof agriculture, the first dummy variable that takes value 1 for 1986-1996,
and 0 otherwise, has a significant positive effect, as also the dummy
variable that takes the value 1 for 1997-1998, and 0 otherwise. The
initial liberalization of the economy in combination with decollectivizationof agriculture helped in its diversification and accelerated growth (Table
14, right panel).
4.3. Effects of Land Titling
Agricultural land was decollectivized in 1988, and land use
rights were granted to households. The Land Law of 1993 gave households
the right to inherit, transfer, exchange, lease, and mortgage their land use
rights. This was implemented by issuing land titles (or LUCs) to all
households. By 2000, 11 million land titles had been issued, making it
one of the largest land titling programs in the world (Do and Iyer, 2006).
Based on a comparison of the Vietnam Living Standard Survey (VLSS)
1992/93 and VLSS 1997/98, an assessment of its impact on the rural
economy was carried out (Do and Iyer, 2006).12 The main findings are
as follows.
First, the proportion of cultivated area devoted to multi-year
crops increased. A household in a province where all households had
LUCs raised this proportion by 7.5 percentage points over the period

12 The 1988 Land Law aimed at liberalizing the agriculture sector in Vietnam. Resolution 10 ofthis Law transferred control and cash-flow rights from the farming cooperatives to individual
households. However, as land-use rights were given to families without the option of trading
them, a proper land market did not develop. Resolution 10 is, however, seen by many as a major
land reform that contributed significantly to agricultural growth in Vietnam (see, for instance,
Pingali and Vo, 1992). There is no denial that this reform unleashed farmers' incentives to invest
but much remained to be done. The 1993 Land Law was an important step towards this end (Doand Iyer, 2006).

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Raghav Gaiha and Ganesh Thapa

1993-1998, compared to a province where no LUCs were issued. The
improved security of tenure induced farmers to invest in long-term crops.
Second, a household in a high LUC-issuance province increased
its non-farm activity by 2.7 weeks per member during 1993-1998.
Mostly, the non-farm activities were food processing, woodworking, andwork in the textiles and garment industry. While the estimate is not large
in terms of weeks worked per member, it implies an increase of 11-12
weeks worked in the non-farm sector for a typical household with 4.5
working members in 1997-1998. However, the effects of the 1993 Land
Law on household expenditure and farm income were not significant.
This is not surprising because investments in crops, such as tea andcoffee, yield returns after a few years. Also, as the improvements in thefunctioning of the land and credit markets may take longer to work out,
the full benefits of land titling are underestimated.
A different methodology with the same data sets yields additional
insights into the efficiency of land reallocation and benefits to the rural
poor during 1993-1998 (Ravallion and Van de Walle, 2006). The main
findings of that study are as follows.
First, after a market in land use emerged, land was reallocatedthat attenuated inefficiency of the administrative assignment of land use.
Specifically, households that enjoyed an inefficiently low land use
increased their holdings over this period. The adjustment coefficient
was one-third in the aggregate sample, implying that one-third of the
proportionate gap between the actual and efficient allocation was eliminatedwithin five years.
Second, under certain assumptions, the speed of adjustment to theadministrative assignment favored the land-poor. Other characteristics
that benefited were households with local roots, male heads, better education,and those with greater non-allocated land. These characteristics are congruent
with competitive forces in so far as they are positively correlated with land
reallocation, and initial land deficits relative to the efficient allocation.

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

4.4. Ethnic and Spatial Dimensions of Poverty
Table 15 provides estimates of poverty, based on different
indices and disaggregated into rural, urban, and different ethnic groups.
Table 15: Poverty Rates and Poverty Gap
Poverty Index and Ethnic Group
Poverty Rate (%)
Urban
Rural
Kinh and Chinese
Ethnic Minorities
Food Poverty (%)
Urban
Rural
Kinh and Chinese
Ethnic Minorities
Poverty Gap (%)
Urban
Rural
Kinh and Chinese
Ethnic Minorities

1993
58.1
25.1
66.4
53.9
86.4
24.9
7.9
29.1
20.8
52.0
18.5
6.4
21.5
16.0
34.7

1998
37.4
9.2
45.5
31.5
75.2
15.0
2.5
18.6
10.6
41.8
9.5
1.7
11.8
7.1
24.2

2002
28.9
6.6
35.6
23.1
69.3
10.9
1.9
13.6
6.5
41.5
6.9
1.3
8.7
4.7
22.8

Note: Poverty rates are measured as a percentage of the population. Poverty gaps reflect the average
distance between the expenditures of the poor and the poverty line, in percentage of the latter.

Source: World Bank (2004).

As can be seen, there was a slowing down of poverty reduction
over the period 1998-2002, relative to 1993-2002. There are signs ofgrowing disparity between urban and rural areas and, among the latter,ethnic minorities continued to record very high poverty rates. Over theperiod 1993-2002, the proportion of Kinh and Chinese fell from 53.9
percent to 23.1 percent in 2002, while that of ethnic minorities fell from86.4 percent to 69.3 percent.13 While food poverty was nearly eliminatedfrom urban areas, more than 40 percent of ethnic minorities continued tosuffer from it. Also, the poverty gap among them has narrowed at a slow rate.
Distribution of poverty by region is given in Table 16. As aregion, the Central Highlands is the poorest in the country, followed by
13 Vietnam is an ethnically diverse society. The Kinh people account for 84 percent of the total
population, while 53 smaller ethnic minority groups account for only 16 percent. Note, however,that all minorities are not equally disadvantaged (Baulch et al., 2002).

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Raghav Gaiha and Ganesh Thapa

the Northern Mountains and the North Central Coast. Poverty rates arehigh in the two deltas, and in the South Central Coast, but lower by half
compared to the poorest regions. The Central Highlands stands out
because of the sluggish poverty reduction rate during 1998-2002. Foodpoverty has remained unchanged over a decade (i.e., 1993-2002), in
sharp contrast to improvements elsewhere.
Ethnic minorities have benefited in varying degrees from theeconomic boom, depending on the group and location. Those living in
the Mekong Delta have experienced a steady reduction in poverty andhave the lowest rate of poverty among the regions. Among the ethnic
minorities living in the uplands, those in the Northern Mountains haverecorded the steadiest improvement. In contrast, poverty rose among theethnic minorities living in the Central Highlands. More than 80 percent
were poor in 2002. The share of ethnic minorities among the poor has
risen from 20 percent in 1993 to 30 percent in 2002. It is likely to rise to
42 percent in 2010. Food poverty estimates are grimmer. The share ofethnic minorities rose from less than 30 percent in 1993 to about 50
percent in 2002. It is expected to be 67 percent in 2010 (World Bank, 2004).
Table 16: Poverty Rate in Vietnam by Region, 1993-2002
RegionWhole country
Northern Mountains
Northeast
Northwest
Red River Delta
North Central CoastSouth Central Coast
Central Highlands
Southeast
Mekong Delta

1993
58.1
81.5
86.1
81.0
62.7
74.5
47.2
70.0
37.0
47.1

1998
37.4
64.2
62.0
73.4
29.3
48.1
34.5
52.4
12.2
36.9

2002
28.9
43.9
38.4
68.0
22.4
43.9
25.2
51.8
10.6
23.4

Source: World Bank (2004).

Why did ethnic minority households remain so poor and failto benefit from the economic boom? Two explanations follow fromdecompositions of expenditure among various groups. One is low

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

endowments of physical and human capital, and the other relies on
geographic and cultural remoteness of the minorities. More specifically,
even if minority households had the same endowments as Kinh
households, this would close no more than a third of the gap in theirexpenditures (Baulch et al., 2002).
But there is another way of looking at the spatial pattern ofpoverty that has important implications for targeting of anti-poverty
interventions. Here the focus is on the poverty density, obtained bymultiplying the incidence of poverty by the population in each area. The
results are strikingly different. The number of poor people per square km
is highest in the more prosperous parts of Vietnam, i.e., the Red River
Delta, the Mekong River Delta, and the coastal plains. In contrast, poverty
density is lowest in the areas with the highest incidence (including theNortheast, Northwest, and Central Highlands). This is because the areas
with the highest incidence of poverty tend to be remote and sparsely
populated. While the case for geographic targeting on the basis of poverty
incidence cannot be rejected, e.g., poverty is likely to be more persistent
in remote, inaccessible areas, it has the limitation that a large fraction of
the poor will be missed. Thus, geographic targeting must be combinedwith anti-poverty interventions in areas/regions with high poverty density(Minot and Baulch, 2005). However, unless such interventions are accurately
targeted, the leakages are likely to be high. An interesting observation
made by Van de Walle and Gunewardena (2001) is that agriculturalresearch and extension does not benefit ethnic minorities simply because
it does not address their specific concerns. While these are essentiallypublic goods and there is a strong case for promoting them, there is also
a stronger case for redesigning them to focus better on crops andagro-economic conditions prevailing in upland areas where ethnic
minorities are concentrated.
Agricultural research is largely confined to wet rice cultivationand cash crops, while ethnic minorities tend to live far from main roads
and markets, and lack access to complementary inputs.
Some more specific considerations in targeting need to beemphasised. The type of poverty alleviation program matters. Some35

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Raghav Gaiha and Ganesh Thapa

programs benefit all households in an area, such as better roads andbetter health care. If there is a fixed cost component per inhabitant insuch programs, the effect will be greater in areas with a high incidenceof poverty. By contrast, other programs targeted to the poor, such as
income transfers or food for work, should concentrate more on areas withhigher poverty densities. However, there is also another consideration:
whether the costs vary inversely with population density. If they do, as in
the case of roads, electrification, and extension, the case for intervening
in areas with higher population and poverty densities is reinforced(Minot and Baulch, 2005; FAO, 2006).
4.5. Progress in Achieving MDGs
A review of progress in achieving various MDGs is given below.14
Vietnam's performance based on data available on 21 MDG indicators asof mid-2006 is summarized in Table 17.15
By any standard, the progress achieved is impressive, as in 14
out of 21 indicators Vietnam has already met the target (e.g., $1/day
poverty, underweight children, primary completion rate, under fivemortality, forest cover, and access to drinking water). There are signs ofregression in a few indicators (e.g., gender primary, HIV prevalence, andCO2 emissions), and slow progress in just one (gender tertiary).
A composite indicator is also constructed. This is based on twosummary measures: a measure of progress and a measure of the (mostrecent) status. Based on this composite index, countries are classified
into four categories: moving ahead, catching up, losing momentum, andfalling behind. Among the moving ahead countries (i.e., those that have

14 This review draws upon ESCAP (2006).
15 The performance is judged using the following categories: Early achiever (has already met thetarget); On track (expected to hit the target by 2015); Off-track-slow (expected to hit the target,
but after 2015); and Off-track-regressing (slipping backwards or stagnating). Note that, for thisreview, a goal is treated as achieved if the country has reached a certain absolute value. In the caseof primary school enrollment ratio, for example, this is 95 percent, and for the poverty rate, thisis 5 percent. For details, see ESCAP (2006).

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

Table 17: Progress towards MDGs in Vietnam
Goal$1/day poverty
Underweight children
Primary enrollment
Reaching grade fivePrimary completion rate
Gender primary
Gender secondary
Gender tertiary
Under five mortality
Infant mortality
HIV prevalence
TBC prevalence
TBC death rate
Forest coverProtected area
CO2 emissions
CFC consumption
Access to water urban
Access to water rural
Sanitation urban
Sanitation rural

Status
Early Achiever
Early Achiever
Regressing
On track
Early achiever
Regressing
Early achiever
Slow
Early achiever
Early achiever
Regressing
Early achiever
Early achiever
Early achiever
Early achiever
Regressing
Early achiever
Early achiever
Early achiever
Early achiever
On track

Source: ESCAP (2006).

made good progress and that have most recent status that is better than
average for Asia and the Pacific), Vietnam ranks high.16
As noted earlier, some concerns cannot be set aside, in view ofthe slowing down of poverty reduction, persistence of poverty among
ethnic minorities, and, in some regions, worsening of inequality.
4.6. Diversification of Rural Economy
Here an attempt is made to examine the potential of a diversified
rural economy in poverty reduction, based largely on Van de Walle andCratty (2003) and FAO (2006). The approach followed identifies common
causative factors, whereby participation in off-farm income earning

16 Other countries in this group are Armenia, Azerbaijan, China, Iran, Kyrgyzstan, Malaysia, theRussian Federation, and Thailand (ESCAP, 2006).

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Raghav Gaiha and Ganesh Thapa

activities and poverty are jointly determined by a set of household andcommunity characteristics. This will help separate those that are common
from those that involve trade-offs between participation in off-farmactivities and living standards. Let us first consider a profile of the rural
economy in Vietnam, focusing on poverty and income source in rural
areas (Table 18).
Table 18: Rural Poverty and Income Source, 1993 and 1998
Year 1993
Income source
Farm only
Farm and labor only
Farm andnon-agricultural
self-employment only
All three
Labor and/or
non-agricultural self
employment only
Total

Northern Red North Central Central South- Mekong Total
Uplands Rive Central Coast Highlands east
Delta
91.5
78.6
77.1

74.5
76.3
69.5

80.2
78.7
72.9

75.3
59.6
52.9

81.8
78.6
33.6

42.5
63.8
33.3

48.3
59.5
28.2

74.8
69.7
58.6

78.6
n.a

67.6
24.6

73.6
n.a

38.5
28.6

55.2
n.a

52.4
26.5

55.6
62.2

61.9
46.4

84.2

71.6

76.9

59.2

70.0

45.8

51.9

66.4

78.3
60.3
48.6

43.1
43.5
32.6

53.3
60.1
45.7

54.5
51.2
22.2

46.1
68.0
32.0

6.7
17.1
4.1

33.6
53.9
27.9

52.3
50.9
35.1

45.1
9.6

35.9
14.0

51.6
n.a

18.1
19.1

50.9
n.a

17.1
15.0

38.4
55.8

38.3
34.5

63.6

38.3

52.6

41.9

52.5

13.0

42.0

45.0

Year 1998
Farm only
Farm and labor only
Farm andnon-agricultural
self-employment only
All three
Labor and/or
non-agricultural self
employment only
Total

Source: Van de Walle and Cratty (2003).

Although rural poverty fell from 66 percent in 1993 to 45
percent in 1998, the wide variation across regions persisted. In 1998, theheadcount index ranged from 13 percent in the Southeast (the rural area
contiguous to Ho Chi Minh City) to 64 percent in the Northern Uplands.
In both periods, farm-only households exhibit the highest incidence ofpoverty nationally (75 percent in 1993 and 52 percent in 1998). They38

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

were also the largest group in 1993 (30 percent of the rural population)and the second largest in 1998 (28 percent), just behind the 30 percent of
those who combined farm with wage labor activities. By far the lowest
poverty was among those in off-farm self-employment and wage labor.
Among all households who do at least some farming (95percent of the population in 1993, and 94 percent in 1998), "farm only"
are the poorest, followed first by "farm and wage," and then by "farm,wage, and self-employment outside of agriculture," and lastly "farm andself employment only" with the lowest poverty, regardless of the poverty
line and generally across regions too (with a few exceptions) (Van deWalle and Cratty, 2003). Therefore, it follows that there is a strong
association between poverty and lack of diversification into wage andself-employment activities in both years.
The econometric analysis confirms that there are some common
determinants of both expenditure/welfare indicators and participation in
off-farm activities (Van de Walle and Cratty, 2003). Education has apositive influence on both welfare and participation in off-farm activities.
Ethnic minority status, however, has a negative influence on both. Someother factors have opposite influences. For example, household size has
a negative effect on welfare but a positive one on diversification. Land ispositive for welfare, and negative for diversification. Urbanization andlower population growth reduce pressure on the land and thus reduce
off-farm diversification in rural areas; they both also reduce poverty.
In another exercise focused on growth of consumption andoff-farm diversification, where one lives is an important determinant ofboth. These common geographic effects capture institutional constraints,
market development, and infrastructure bottlenecks. There is, however,no non-geographic characteristic that affects consumption growth overtime and rising diversification in the same way with the exception of the
proportion of children in a household.
The policy implications are that roads, transportation, and markets
are crucial for both. For off-farm income earning activities, however,information about and access to markets must be more widely available.

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Raghav Gaiha and Ganesh Thapa

There is also a case for more flexibility in land and labor markets toswitch their use more efficiently. Well defined land property rights andother land policies must ensure that access rights are protected. There isevidence that those who diversify tend to maintain their cultivation, even
if more attractive options are available. The important point to note,however, is that these policies will undoubtedly help some, but notothers (Van de Walle and Cratty, 2003).
From this perspective, a snapshot of rural income diversification
over the period 1998-2002 is helpful (FAO, 2006). The number ofincome sources in the aggregate rose from 4 in 1998 to 4.67 in 2003.
Regions that saw a rise in the number of income sources included theCentral Highlands (from 3.72 to 5.24), the Northern Uplands (from 4.53
to 4.94), the Mekong River Delta (from 4 to 4.90), and the Southeast(from 4 to 4.33). The number of sources declined in the Red River Delta(from 4.50 to 4.37) and in the North Central Coast (from 4.82 to 4.64).
The fact that some regions that experienced rapid poverty reduction
during 1998-2002 also saw considerable diversification of income
sources points to a link between them (e.g., the Northern Uplands and the
Mekong River Delta).
4.7. Social Safety Nets
The social safety nets following decollectivization comprise
initiatives that are centrally mandated but locally implemented (Van deWalle, 2004). An overarching concern is that the traditional social
protection system, conceived mainly for public sector workers, mustcomplete the transition to a market economy, so as to provide affordable
insurance against risks—especially to workers who are increasingly
mobile, occupationally and geographically (World Bank, 2006).
The Social Security System provides pensions and other
employment-related social insurance payments. An analysis of
VLSS1997/98 shows that payments go to members of households
accounting for 11.2 percent of the population, with greater coverage in40

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

urban areas (18.3 percent) than in rural ones (9.4 percent). Incidence is also
more pro-poor in urban areas than in rural areas, as per capita amounts
received in the latter are much smaller than in the former.
Under the Social Guarantee Fund for regular relief, scarce central
public resources necessitate that implementation and coverage ultimately
depend on local governments and their resources. Contrary to official
claims, barely 9.6 percent of the population receives subsidies under thisscheme; the fraction is slightly larger (10.2 percent) in rural areas.
Although the poorest quintile in urban areas received the largest amounts,
there is little evidence of targeting across the rest of the urban or rural
distributions.
The Contingency Fund for Pre-harvest Starvation and Natural
Disasters is designed to mitigate the distress in the wake of naturalcalamities and other emergencies. Following local covariate shocks, relief
is provided by district and provincial authorities. The emphasis is mostly
on surviving the emergency through credit. As institutional capacity andfinances are limited, aid is often insufficient. Poor households, in particular,
are prone to further impoverishment as a result.
Several national development programs (NDPs) have been
introduced that aim for growth, but offer little protection. These programs
cover employment generation, reforestation, micro-credit, and physicalinfrastructure investments.
In 1996, an attempt was made to coordinate these programs andthe resources needed under the National Hunger Elimination and Poverty
Reduction (HEPR) Programme. During 1998-2000, the government
implemented the National Target Programme on Poverty Alleviation andformulated the Poverty Alleviation Strategy for 2001-2010. These
initiatives are, however, not matched by additional resources.
So it is fair to conclude that the government's safety net program
made a negligible contribution to poverty reduction during the 1990s. The
evidence also suggests that it did not fulfil a safety net function as it did
not protect those who faced falling living standards during this period,
partly due to low overall spending on these programs relative to needs.

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Raghav Gaiha and Ganesh Thapa

Besides, there was a lack of responsiveness of transfers to changing
household circumstances.
Design changes in some existing programs, e.g., in targetingmechanisms, may strengthen their promotional and protective roles. For
example, if household transfers were equally divided only among the poor,
17 percent of the poor or 7 percent of the population would escape poverty(Van de Walle, 2004). Several reforms to the current institutional arrangements
for delivering social welfare programs would add to their cost-effectiveness.
The current redistributive process could be restructured to enforce better
redistribution to lower administrative levels. This would involve improving
incentives and mandates for targeting the poor locally. There is also a casefor new programs that focus on insurance mechanisms. Incomes and labor
supply have risen but so has their variability, while local risk-sharing
arrangements have declined (Van de Walle, 2004).
4.8. Prospects of Poverty Reduction, Risks, and Insurance
Our analysis has drawn attention to the impressive track recordof Vietnam in accelerating growth rates and poverty reduction during thetransformation from a planned economy to a market-oriented one. Muchof this achievement hinged on a rapid growth of agriculture and its
diversification, expansion of agricultural trade, and a consequent
reduction in rural poverty. Some concerns, however, cannot be overlooked.
These relate to a slowing down of overall and agricultural growth rates,
worsening of inequality over time and space, and slowing down of poverty
reduction. Not only national poverty reduction but also rural poverty
reduction slowed down (from 66.4 percent in 1993 to 45.5 percent in
1998, and to 35.6 percent in 2003).17 Worsening of income and land
inequality during recent years also impeded poverty reduction.18 What

17 For details, see FAO (2006).
18 Although estimates differ, the Gini coefficient of income distribution rose from 0.356 to 0.407
over 1995-2000. The Gini coefficient of land distribution rose from 0.49 to 0.64 over the period
1993-2004 (FAO, 2006; World Bank, 2006).

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

is worrying is the growing concentration of ethnic minorities among thepoor and its continuation in the near future.
Poverty is not just a matter of deprivation but also of vulnerability
to shocks, which happen at the household, community, and national levels.
Shocks that can trigger downward mobility of vulnerable households,
sometimes into persistent poverty, include illness, injury, epidemics,social stability, loss of markets, crop failures, droughts, and floods. The
poor are often the most vulnerable as they lack the ability to deal with awide array of risks. Their low incomes do not permit them to accumulatesavings. Nor do they have easy access to insurance. So when a crisis
occurs, they are unable to deal with it. A recent study (World Bank, 2006)
contains notional estimates of vulnerability, which represent the share of
the population which is not in a position to sustain its expenditure level(above the poverty line) in the event of a shock. The criteria used are (i)whether expenditure is less than 10 percent above the poverty line, and(ii) whether their dwellings were valued at less than 15 million VND, andother durable assets did not exceed 5 million VND in 2002. Using theVietnam Household Living Standards Survey 2002 (VHLSS2002), theaggregate estimates of the vulnerable range from 6.7 percent to 10.2
percent of the population. However, there are other ways of measuring
vulnerability that are more comprehensive and informative. A limitationof the World Bank vulnerability estimates is that they are confined to ameasure of the non-poor who are likely to slip into poverty. Neither theseverity of the shock nor loss of welfare of the poor is taken into
account.19
An estimate of “vulnerability as low utility” allows a decompositionof welfare losses due to poverty, aggregate and idiosyncratic risks.
Vulnerability so defined is high, with poverty as the single largest component,
followed by aggregate and idiosyncratic risks (Ligon and Schecter,

19 For an exposition of different measures of vulnerability and their estimates, see Gaiha and Thapa(2005).

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Raghav Gaiha and Ganesh Thapa

2003). Such estimates are more useful as they help identify proximate
causes of loss of household welfare due to structural poverty and volatilityof consumption. By being able to distinguish between those who would
not be vulnerable in the absence of consumption volatility and those whoare structurally poor, specific measures that limit consumption volatilityof the former by limiting their exposure to risk and/or by enhancing theirex-post coping ability would be helpful, as against interventions designed
to help the structurally poor by raising their mean consumption.
Another recent study (Imai et al., 2007) examines in greater
detail the links between vulnerability and poverty over the period
2002-2004. The main findings are that (i) in general, higher vulnerability
in 2002 translates into poverty in 2004; (ii) vulnerability of the poor
perpetuates their poverty, and that more specifically, while some manage
to overcome their poverty despite being vulnerable, their prospects ofdoing so are less likely than of remaining in poverty; and (iii) vulnerabilityof the non-poor propels them into poverty over the period in question.20
As a general observation, there is a case for greater emphasis on
risk reduction and mitigation strategies, as opposed to risk coping
strategies. Also, both formal and informal mechanisms through private
and public agencies need to be integrated, taking into account theircomplementarity as well as substitutability. Macroeconomic stability,easier market access, and protection of private property rights havestrong complementarities, while formal insurance may substitute for
informal insurance and other networks of community support. Anotherrelated concern is whether the potential of indigenous knowledge
systems could be better exploited through easier access to water, extension,and other support services, and whether it is feasible to blend suchknowledge systems with new and emerging technologies to enhance
productivity and ecological sustainability. A third policy option thatdeserves careful assessment is feasibility of crop insurance on a commercial

20 For methodological and panel data details, see Imai et al. (2007).

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges

basis, focusing on insurable risks and premia based on actuarial data. An
innovative solution is area-based index insurance contracts, dealing withspecific perils or events such as average yield in the area, drought, or
flood, that are defined and recorded at a regional level. Insurance could
be sold as a standard contract for each unit purchased, and the buyer
could have the freedom to purchase any number of units. Some of
the advantages include low administrative cost, ease of marketing,affordability for the poor, low moral hazard problem, and, above all,financial viability. International financial markets could be tapped forreinsurance to hedge against the risk of huge indemnities in the context
of natural calamities and disasters (World Bank, 2001; Skees et al.,2005). While there is considerable evidence on the income enhancing
potential of micro-credit, a priority in the present context is its potential
for income diversification and stabilization, as opposed to use of loans
for consumption stabilization or smoothing. Along similar lines, thefocus needs to shift to income stabilizing effects of workfare. Finally,
income diversification through non-farm activities for poorer segments
calls for not just easier access to credit but also skill acquisition andeasier access to markets (IFAD, 2004).

5. Concluding Remarks
Vietnam's growth acceleration during the 1990s followed notjust from technological change but also from institutional restructuringthat created incentives to invest and enhance productivity in a market-oriented
economy. For instance, the effects on agricultural growth of the freeingof prices from controls and land titling were dramatic. However, decelerationof agricultural growth, slowing down of poverty reduction, and worseningof inequality both between rural and urban areas and within rural areas
may impede the transition to a more prosperous economy. Based on our
analysis, we can distill the following lessons to redefine policy priorities
in light of emerging concerns.
(i) Institutional reforms matter a great deal at the macro, sectoral,
and local levels. While gradualism underpinned Vietnam's

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Raghav Gaiha and Ganesh Thapa

impressive overall and agricultural growth in the transition to amarket economy, some strategic corrections are called for tosustain the momentum.
(ii) Success of reforms can sometimes impede further success. The
drop in rice and coffee prices in the world market was causedby rapid growth of volumes exported. This underlies the needfor quality improvements to add greater value to rice and coffee
chains of production. The private sector has considerable potential
for enabling this switch.
(iii) The scope for modernization of technology in agriculture
continues to be immense, as high yielding varieties are confined
to a little more than one-third of the cultivated area. Larger
allocations are needed for agricultural research and strengtheningof extension.
(iv) Comparative advantage of agricultural production across different
regions also varies greatly. The Red River Delta and the
Mekong River Delta are far ahead of the other regions, followedby the Southern Central Coast and Southeastern regions. The
three mountainous regions and the Northern Central Coast lag
far behind. Infrastructural development and easier accessto new technologies would impart greater competitiveness toagricultural production, as well as reduce inter-regional disparities.
(v) Equity-efficiency considerations in land consolidation are far
from straightforward. However, commercialization of agriculture
has its own relentless pace. To the extent that well-endowed
commercial farmers have better prospects of growth in acompetitive environment, those displaced from agriculture must
be absorbed in non-farm activities. Diversification of the rural
economy, including within agriculture through, for example, ahigher share of livestock products, is preferable to uncontrolled
urbanization, and consequent congestion and spreading ofslums. But this requires easier access to credit and vocational
training—especially for women.

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Growth, Equity, and Poverty Reduction in Vietnam: Prospects and Challenges(vi) Incomes of households involved in non-farm activities are muchhigher than those of farm households. At the regional level, theNorthern Highlands, the Red River Delta, and the North Central
Coastal regions witnessed a marked spurt in non-farm activities.
This was linked to growth of traditional manufacturing villages
in this area, somewhat akin to township and village enterprises
in China. The decline in the Mekong Delta and the Southeasternregion, on the other hand, was related to out-migration ofhouseholds to urban areas, sharpening the urban-rural divide.
Apart from credit expansion and better infrastructure (e.g.,easier access to markets), it is again imperative to expand
vocational training, especially for women.
(vii) Worsening of inequality is in itself a growing concern and achallenge. If it were simply an inverted U-shaped relationshipbetween inequality and growth, the problem would be selfcorrecting. However, such a relationship seems unlikely, given
the abject poverty of some ethnic minorities and their regional
concentration, which could erupt into conflict and disruption ona large scale. Vietnam's impressive record in attaining several
MDGs, including halving of extreme poverty, may thus bereversed. Public investment in creating better opportunities forhighly disadvantaged groups and regions is not just desirable
but also unavoidable. Inclusive development is often the best
recipe for social stability.
(viii) Incentives faced by local authorities need to be reviewed.
Without additional resources, provinces lagging behind areunlikely to catch up. While there are budgetary mechanisms inplace that transfer resources from richer to poorer provinces,larger transfers need to be combined with greater accountabilityof provincial authorities to promote growth and achieve poverty
reduction (World Bank, 2006).
To conclude, to sustain the gains achieved during the transition
to a market economy, the challenge is not just to maintain the momentum

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Raghav Gaiha and Ganesh Thapaof policy and institutional reforms, but also to create conditions for more
inclusive growth.

References
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Bangkok: FAO Regional Office for Asia and the Pacific.
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in Vietnam," Journal of Asian Economics, vol. 13, no.5: 653-657.
Gaiha, R.; and G. Thapa. 2005. "Risk, Vulnerability, and Poverty in Asiaand the Pacific Region," mimeo. Rome: International Fund for
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Gaiha, R.; K. Imai; and M. A. Nandhi. 2006. "Millennium Development
Goal of Halving Poverty in Asia and the Pacific Region,"International Fund for Agriculture Development (IFAD) Occasional
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International Fund for Agriculture Development (IFAD). 2004. Rural
Enterprises and Poverty Reduction. Rome: IFAD Asia and thePacific Division.
Imai, K.; R. Gaiha; and W. Kang. 2007. "Vulnerability and Poverty
Dynamics in Vietnam," Manchester: School of Social Sciences,
University of Manchester, mimeo.
Ligon, E.; and L. Schechter. 2003. " Measuring Vulnerability," The
Economic Journal, vol. 113, issue 486: 95-102.
Minot, N.; and R. Baulch. 2005. "Spatial Patterns of Poverty in Vietnam
and Their Implications for Policy," Food Policy, vol. 30, issue 5-6:
461-475.
National Centre for Social Sciences and Humanities (NCSSH). 2001.
National Human Development Report 2001: Doi moi and Human
Development in Vietnam. Hanoi: The Political Publishing House.
Nguyen, N. K. 2005. Assessment of the Demand for Staff training
Relating to Poverty Reduction in Ha Giang. Hanoi: Ministry ofLabor, Invalids and Social Affairs (MOLISA).
Pingali, P.; and T. X. Vo. 1992. "Vietnam: Decollectivization and Rice
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Ravallion, M.; and D. Van de Walle. 2006. "Land Reallocations in an
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and Income: Estimating the Interrelationships," draft.
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in S. Dercon (ed.), Insurance against Poverty. Oxford: Oxford
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United Nations Development Program (UNDP). 2001. Human
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Development. New York: Oxford University Press.
Van de Walle, D. 2004. "Testing Vietnam's Public Safety Net," Journalof Comparative Economics, vol. 32: 661-697.
Van de Walle, D.; and D. Gunewardena. 2001. "Sources of Ethnic
Inequality in Vietnam," Journal of Development Economics, vol. 65,
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Van de Walle, D.; and D. Cratty. 2003. "Is the Merging Nonfarm Market
Economy the Route out of Poverty in Vietnam?" World Bank Policy
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World Bank.
_______. 2006. Vietnam Development Report 2006. Hanoi: World Bank.

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Chapter 3
From Infrastructure to Institutions:
Reforming Primary Health Care in Vietnam
Scott Fritzen

Abstract
Vietnam has long been known for having achieved impressive health sector
results despite being a low-income country. In part these achievements
rested on provision of basic health services through some 10,000
Commune Health Centers (CHCs) sprinkled throughout the countryside.
This paper examines the attempt to rebuild and reequip a few thousandof these health centers over the late 1990s using the first World Bank
loan to the Ministry of Health. The paper draws on the Vietnam National
Health Survey to compare a matched sample of project and non-project
health centers along a range of indicators. The substantial supply-side
investments in infrastructure did lead to marginal increases in the utilizationand the quality of preventive health services provided by the centers. But
they had little demonstrable impact on the incentives and pressures
faced by CHC staff and local authorities. Such institutional factors
are heavily implicated in the substantial disparities in access andquality that continue to afflict the sector. As in many other transitional,
decentralizing settings, institutional and "demand-driven" reforms
will be essential to ensuring that the revitalized primary health careinfrastructure is used efficiently and accessed equitably.

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Scott Fritzen

1. "Second Generation" Challenges in Transitional
Health Sectors
The question as to whether it is possible to significantly reducehigh levels of infant and maternal mortality in very poor countries has
been answered repeatedly over at least the past fifteen years. The answer
is a resounding yes. Several low-income countries have succeeded in
reducing these levels over the past three decades even in circumstanceswhere there was no or even negative per capita economic growth andvery low government expenditure (Mehrotra, 1997).
One of the causes for such success is also well known toanalysts: increasing the access of rural populations to preventive healthservices such as child and maternal immunizations, Vitamin A distribution,
malarial bednets, and facilities for assisted child delivery. Countries suchas China, Cuba, Indonesia, Sri Lanka, and Vietnam built networks ofcommunity health centers that—though modestly staffed and typicallyeven more modestly equipped—brought basic curative care to the countryside(Osteria, 1997). These centers also served as the command and control
posts for the public health delivery that played so disproportionate a rolein the impact the improved health systems had on mortality reduction.
Yet these relatively successful (but still relatively poor) countries
have faced a new "second generation" set of pressures in sustaining anddeepening their public health achievements. One pressure is financing.
What one analyst referred to as the recurrent costs of the primary healthcare (PHC) miracle—not least in terms of maintaining and supplying thebroad network of grassroots health centers—have proved increasingly
daunting in many contexts, particularly where government expenditureon health has failed to grow.
Another source of pressure concerns organizational andinstitutional reforms that have complicated, and often blocked, attempts
to steadily improve quality and equitable access to PHC services. In
decentralizing settings, such as Indonesia and the Philippines, healthcenters have been largely dependent on the resources of local

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From Infrastructure to Institutions: Reforming Primary Health Care in Vietnam

governments, causing increasing disparities among regions. In manytransitional settings, institutional reforms have led to a proliferation ofprivate providers, while simultaneously leading public sector providers torely increasingly on cost recovery mechanisms. This change has led toboth vicious and virtuous quality circles for differently positioned grassroots
health providers, and has had problematic consequences for the access ofrelatively poor households to clinical services (Fritzen, 1996).
Financing and institutional pressures often reinforce eachother, as in Indonesia or Sri Lanka. But they are conceptually separate:transitional countries experiencing rapid net infusions of resources to thehealth sector, such as Vietnam and China, have nevertheless struggledwith the allocations of these resources among provinces and between
curative and preventive health activities (World Bank, 1997; SRVN andDonor Working Group, 2000). Worsening of grassroots delivery, at leastin a subset of localities, can coexist with substantial infusions of aggregate
resources.
The general conclusion is that the formula for success in meeting"first generation" challenges, i.e., investments in low-cost, high-impact
vertical programs often coupled with strong social mobilization, is notnecessarily the same for the second, where systems have become more
complex. How best then for these countries to revitalize the grassroots
PHC infrastructure? Where should one direct investments, and with whatstrategy, to build on the accomplishments of the previous period and toleverage the health infrastructure remaining from the previous generationof investments?
This paper examines Vietnam as a case study in meeting theinstitutional challenges noted above. Specifically, it examines a tension
arising in the investment decisions faced by health planners in Vietnam.
One side of this tension is the twin administrative influences of socialism
and centralized planning, which encourage equal investments in eachof the some 10,000 Commune Health Centers (CHCs) dotting thecountryside. Despite the proliferation of private-sector providers in the
countryside over the past 10 years, so-called "supply-side" investments

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Scott Fritzen

in maintaining the PHC infrastructure are still compelling: the centersprovide essential preventive health services and basic curative care for thepoor. The other side of this tension is the great diversity of the country—interms of terrain, social capital, and institutional quality—which may callfor a more targeted, "asymmetrical" approach to rebuilding the grassroots
infrastructure (though this would be more capacity intensive).
The remainder of the paper is organized as follows. The next
section provides background to Vietnam's health sector in transition.
Section 3 introduces data from a large-scale attempt to rebuild thegrassroots PHC infrastructure from 1997-2003, using a large World Bank
loan managed by the Ministry of Health (MoH). Section 4 uses amatched sample of project and non-project communes to test the impactsof this infrastructure expenditure on utilization and access by the poor.
The policy discussion in Section 5 draws out implications of the analysis
for the decision of where Vietnam, and by extension similarly situatedcountries, should allocate resources to revitalize PHC delivery systems at
the grassroots.

2. The Health Sector in Transitional Vietnam
2.1. From Historical Achievements to Health Sector Crisis
Vietnam's celebrated health sector has been through an incredible
array of reforms, ranging from commercialization of curative care to therecentralization of expenditure on commune health worker salaries.
These reforms are far from over. As in China, impressive achievementsin the social sectors in Vietnam came during the period of central
planning. In this system, the overwhelmingly rural populace wascollectivized into specialized work brigades that organized both production
and consumption. Workers in the collectives had good access to basic
health care, and the widespread provision of day-care made it possible
for women to participate in the labor force (Tran, 1995). As a result of
this health care system, by the mid-1980's Vietnamese enjoyed a life54

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From Infrastructure to Institutions: Reforming Primary Health Care in Vietnam

expectancy among the highest, and infant mortality rates (IMR) among
the lowest, in its region and income class (Nguyen, 1997).
One effect of the economic stagnation of the early 1980s was
the weakening of this commitment to social mobilization and equity.
Neo-Stalinist forms of political organization predicated on strong
controls on lower levels of government were paralleled in the healthsector by renewed emphasis on curative medical education and on fiscal
allocations micro-managed by the center. In fact, by the mid-1980s thehealth sector showed the same pronounced orientation toward curative
rather than preventive care seen in other countries. About 80 percent of
the health budget was devoted to curative care, primarily in central andprovincial hospitals.
The transition to a market economy exacted a further toll on thehealth sector. Immediately following the introduction of market reforms
in 1986, however, an already bad situation deteriorated sharply: healthworkers were not paid, drugs of unknown quality flooded the countryside,
and CHCs lost their organizational and economic support fromagricultural cooperatives. As late as 1992, the World Bank reported a"major resurgence" of malaria in the Northern Upland region and inareas bordering Cambodia, presumably caused by the scaling back of
DDT spraying. Malnutrition rates increased even as Vietnam became theworld's third largest exporter of rice (World Bank, 1992). Very little
documentation of health impacts exists for the period 1986-1992,
making a more detailed assessment problematic.
2.2. The Institutional Challenge
In fiscal terms, the situation had largely stabilized by 1993,
following which real per capita expenditure on the health sector as awhole increased as a share of a rapidly growing GDP. But the challenge
to institutions remained. Writing in 1993, Smithson summed up thesituation by noting that inconsistency in health policy "relates to the shift
from a clear, unequivocal commitment to socialist health policy to a

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more complex set of objectives proposed under the transition period:
preserving social equity and adapting to socioeconomic change"(Smithson 1993: 29). A Harvard Exploratory Health Team assessed thedanger of this policy-drift, concluding that the "health sector could
combine the worst features of both the public and private sectors.
Deteriorating public assets could be increasingly commandeered by apoorly-paid public cadre for private purposes," the report noted, "bringing
the bureaucracy, inefficiency and unresponsiveness of the public sector
together with the inequity, ineffectiveness and social damage of theprivate sector" (Chen and Hiebert, 1994).
Yet by the mid- to late-1990s, there were persuasive reasons for
Vietnam's health planners to feel optimistic. There had been no marked
decline in public health indicators over the transition period, unlike theveritable systems collapse that had afflicted many transitional countries.
This was largely thanks to tonic effects of broadly-based economic
growth: incomes were up, and people were eating better.
Such situation also reflected the government's success instabilizing sector organization and financing. Two factors were particularly
critical. In 1996, the salaries of a quota of personnel from each CHC
were incorporated into the national budget, allowing the introduction ofsome organizational discipline. And funding for targeted, specificpurpose "national programs" in such areas as malaria and tuberculosis
were greatly beefed up, in some cases growing exponentially over shortperiods of time. Partly as a result of these "supply-side" measures,
utilization of CHCs, which had dropped precipitously in the late 1980s,
stabilized, albeit at a low level. Preventive health services also scoredsignificant successes: both malarial and TB incidence declined markedly
after 1998 (World Bank and others, 2001).
Some qualifications to this picture of improved aggregate
funding and organizational success should be kept in mind. The first
concerns patterns of financing. Absolute levels of health expenditure
remain low by developing country standards, whether measured inabsolute terms or as a percentage of GDP. And improved levels of56

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From Infrastructure to Institutions: Reforming Primary Health Care in Vietnam

aggregate financing have not led to improved intra-sector allocation
efficiency, as the bulk of investment is concentrated at provincial and, toa lesser extent, district hospitals rather than the public health-oriented
commune health centers.
The second relates to the declining utilization and access of thepoor. The number of both inpatient and outpatient consultations in public
facilities dropped substantially in the initial years of the reform period.
Aggregate utilization rates were cut by one-half from 1987 to 1990, fromroughly two to one consultation per person per year. Into the new millennium,
these numbers have not changed dramatically: inpatient consultations
have recovered somewhat, while aggregate consultations per capita may
still be falling. Less clear is whether this truly represents a disastrous turnof events. Many pre-reform estimates of utilization were sensitive toreporting pressures, so the fall in aggregate numbers may not havereflected a proportionate drop in service coverage. On the other hand,World Bank data confirm the common view that declining utilization
rates may affect the poorest quintile of the population most (World Bank,
1996 and 2001).
If formal, recorded consultations in public health facilities havedeclined, part of the slack has been taken up by the "private sector," thatis, services primarily provided by public health employees off hours or
outside the clinic. The practice of medical providers at the grassroots
level charging patients informally for care received was thought to be outof control in the early 1990s. Some studies suggest that the problem may
have subsided somewhat, or changed form, perhaps due to stabilizationin the salaries of health workers. However, a large proportion of healthactivity, including both self-medication with potentially dangerous drugs
and consultations in the "private" or "commercialized" sector, is effectively
beyond the reach of regulation by the health authorities.
The third problematic element concerns continuing disparities
in health outcome and coverage indicators. Aggregate health funding
increases, accompanied by relatively good targeting on poorer provinces,
are one important feature of the current health care system. However,57

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disparities in health outcome and program coverage indicators—whether
seen by region, socioeconomic status, or ethnicity—are still very large
by almost any measure.
2.3. The World Bank-Ministry of Health National Health Support
Project (NHSP)
A major question in the mid-1990s was thus how to revitalize
the grassroots health infrastructure. The dropping of the economic
embargo by the United States against Vietnam in 1994 had paved theway for the entry of multilateral financial institutions, such as the World
Bank, which initiated its first loan shortly thereafter. The World Bank has
since then contributed a large amount of development finance toVietnam; disbursements in 2001 alone reached $739 million.1
The World Bank began in 1994 to explore ways of investingin the health sector. The twin projects, which launched World Bank
cooperation in the sector, were the National Health Support Program(NHSP) and the Population and Family Planning Project (PFPP) (withvery similar aims and investment patterns). Encompassing a total
investment of $150 million in thirty of Vietnam's poorest provinces, the
NHSP and PFPP together represented a substantial percentage of the total
capital expenditure in the health sector over this period at district andcommune levels. The NHSP itself was implemented from late 1996 to
September 2003 with a total approved credit of $101 million (of whichapproximately 75 percent had been disbursed as of June 2003) andseveral additional millions in grant funding from Dutch and Swedishbilateral aid.
The National Health Support Project had three main objectives
and corresponding components, of which the material in this paper
concerns primarily component 1, ambitiously stated as "investing in an
essential infrastructure for delivering public health services in Viet
Nam," for which investment totaled approximately US$70 million. Its
1 For further details, see www.worldbank.org/data/countrydata/aag/vnm_aag.pdf

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From Infrastructure to Institutions: Reforming Primary Health Care in Vietnam

objective was to "provide high quality, reliable primary health care on asustainable basis in 16 poorer provinces" (World Bank, 1995).
Specifically, the CHC was to be able to properly perform:· Case finding and case management in prevalent infectious andcommunicable diseases, such as tuberculosis and malaria;· Appropriate quality safe motherhood and child health care,including family planning;· Early first-contact care for common medical problems of the very
poor who have no means to pay; and· Informational campaigns, epidemiological monitoring, and community
mobilization for public health promotion.

3. Data and Hypotheses
Testing the assumptions and hypotheses contained in NHSP's
analysis of the health sector—contained largely in its design document(World Bank, 1995) and Aide Memoirs produced over the course of the
project—elucidates the strengths and limitations of a supply-driven
approach to PHC revitalization in a transitional context. Like the dye ina catscan, supply-driven projects reveal the state of the system andsuggest where the institutional blockages to enhanced health sector
performance may lie.
The project's diagnosis of the problems confronting Vietnam's
grassroots health infrastructure is nicely summed up in the following
paragraph:"The overall picture is thus of a public health care sector which
has reached a crossroads. Basic primary health care interventions of apreventive or palliative nature are being delivered, but coverage is still
well below satisfactory levels and the quality of services is uncertain. If
facilities and staffing continue to deteriorate, and resources are notforthcoming for upgrading and maintaining a well-supplied andwell-functioning system, it is likely that even these basic PHC services
will cease to perform adequately. Because of resource constraints and theready availability of pharmacies, the public system is already little used

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Scott Fritzen

by any section of the population for basic curative care." (World Bank
1995: 23)
The project's response to this assessment was primarily
increased investment in infrastructure, i.e., investments in the physicalbuilding and equipment. According to project documents, doing sowould have the following specific effects, which can be considered as
three groups of hypotheses for this study, that roughly correspond in theevaluation literature to project inputs, outcomes, and outputs.
"Inputs" hypotheses (H1): Investments in the grassroots
infrastructure would lead to considerably enhanced capabilities of the CHCs.
"Outcomes" hypotheses (H2): The enhanced capabilities andperformance of these health sectors would lead to: (i) enhanced utilizationof the centers for basic curative services, which would disproportionately
benefit the poor; and (ii) enhanced capacities of the centers to perform
preventive service functions.
"Outputs" hypotheses (H3): Substantially improved healthcenters and worker knowledge would have positive effects on treatment
quality, supervision, and management of the health centers, staff morale,
the commitment of local authorities to funding the health centers, and theperception of PHC quality on the part of the rural population.
This paper draws on two sources to test these hypotheses. The
first is the use of the comprehensive Viet Nam National Health Survey(VNHS), itself funded under component 3 of the NHSP and conducted
over several months in 2001-2002. It was implemented nationwide inover one thousand project and non-project communes. Comprising
integrated commune-level, facility-based, health worker and household
surveys, the database allows assessment of several indicator clusters
highly relevant to the evaluation of component 1, including:· Project outputs, such as the state of the infrastructure
and availability of essential drugs, drawing on the facility andpractitioner questionnaires.
· Strength of other PHC components, such as budget allocations
to the CHCs and district supervision patterns, drawing on
the facility and commune leader questionnaires.

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From Infrastructure to Institutions: Reforming Primary Health Care in Vietnam· CHC coverage and quality indicators, such as availability ofservices at the center and actual utilization of the centerfor different services, drawing on the facility and household
questionnaires.
Some 88 communes covered by the survey's two-stage stratified
sample had Commune Health Centers that had completed NHSP-financed
reconstruction prior to the date of the National Health Survey interviews.
These 88 CHCs, distributed over 15 of the 17 project provinces, comprise
4 percent of the some 2,200 CHCs eventually supported under the project.
Table 1: Comparison of Characteristics of Project and Matching
Communes used in Quantitative Analysis of VNHS
Indicators
Number of communes in groupEthnic minority households (%)
Have a hospital within commune boundaries (%)
Participate in Hunger Eradication and Poverty Reduction Program(HEPR) (%)
Have road available to commune People's Committee (%)
Distance to district hospital (km)Share of poor households (according to the standards of the Ministryof Labor, War Invalids and Social Affairs [MOLISA]) (%)
Have a Primary Health Care Committee (%)
Mean number of private practitioners in commune (traditional
medicine)
Mean number of private practitioners in commune (Western
medicine)
Have a Polyclinic (%)
Are on government's "Poorest Communes" list (%)
Mean area (hectares)
Topography
CoastalDelta
MidlandLow mountains
High mountains

Project
Matching
Communes Communes
88
15.9
10.2
70.5

227
18.1
10.1
76.7

95.5
9
16.7

96.9
11
17

88.6
1.29
2.82
14.7

86.8
1.25
3
13.2

9.1
3,947

15.4
3,447

7.9
42.1
14.8
18.2
17.1

7.9
39.2
10.5
22
20.3

Source: Author's field survey.

Use of the VNHS allows for systematic comparisons between
project and matched non-project communes. A propensity score matching

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model was employed to find the closest comparison group from thesample of non-project communes in the VNHS. Table 1 shows theindicators used to construct the sample and the actual results obtainedwith the current set of matching communes. These indicators reflect
exogenous factors that influence key outcome indicators, but arethemselves unlikely to be affected by the project. Here, they fall into four
categories: (i) basic physical and locational characteristics; (ii)socioeconomic characteristics of the population; (iii) government
programs supplied (not in the health sector); and (iv) access to alternative
providers of health services. Statistical tests for significance confirm
visual inspection: project and "matching" communes are not significantly
different in terms of any the criteria used to construct the matchingcommune sample. They in fact offer a remarkably similar profile.
The second method employed was fieldwork in four provinces
selected for their regional representativeness—Son La, Quang Tri, Phu
Yen, and Soc Trang—in which a total of 8 districts and 16 commune
health centers (all project-based CHCs) were visited by a team of fiveresearchers for two days each in 2003. The fieldwork involved
semi-structured and open-ended interviews with provincial and district
health officials and CHC personnel as well as focus group discussions
with users and non-users of CHC services in the community. The
research aimed at the direct observation and assessment of management
practices in the center, the strength of preventive health program
implementation, and patterns underlying utilization of CHC services inthe broader context of district health systems.

4. Results and Analysis
4.1. "Inputs" Hypotheses (H1): Effect on Infrastructure Quality
One precondition for the project to have an impact is that the
infrastructure itself be significantly upgraded. This may appear overly
obvious, but corruption, inefficient implementation, and poorly conceived
operation and maintenance mechanisms could all theoretically blunt theimmediately visible impact of the project on infrastructure quality.

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Table 2: Infrastructure Characteristicsin Project and Matching Communes (percent of CHCs)
Project-invested communes
Indicatorsp

Rebuilt more
Rebuilt up to
All than two years two years priorprior to survey
to survey

N
88
Built solid (b2=1 | b2=2)
100
Without need of repair
0.017 25
Needs two or more repairs76
Has electricity
92
Has clean water source on premise
86
0.016 98
CHC has a toilet
0.008 83
(if yes): Toilet is sanitary
General condition of CHC assessed 0.044 85
by surveyor as clean

44
100
14
82
89
98
100
79
89

Matching
communes

44
100
36
68
96
75
96
88
82

227
96
14
78
94
77
89
67
75

Note: p refers to significance level based on a two-sided t-test for hypothesis that the project (All)and matching commune means are the same. Only reported here if p<0.05.

Source: Author's field survey.

Approximately 2,200 CHCs in 17 provinces were upgraded or
newly constructed (in the vast majority of cases) by the project. In
comparison with matching communes (most of which also received
significant infrastructure investments since 1996), the quality of CHC
infrastructure is higher along a number of indicators, although in manycases only modestly so (Table 2). Virtually all project-invested CHCs arebuilt solid, have rooms for consultation, immunization, birthing andfamily planning provision, and have toilets. More significantly, a greater
percentage of project than matching CHCs have appropriate hand washingfacilities, the toilets of project CHCs are significantly more sanitary thanthose elsewhere, and more CHCs have a source of clean water on thepremises. Taken together, these basic characteristics suggest that project
CHCs have superior capabilities to perform basic functions, in comparison
with matching CHCs.
Trend analysis (historical reconstruction of the histories ofCHCs) from the fieldwork adds a before/after aspect to the comparison.
Fully five of 16 facilities surveyed were classified as "temporary"63

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Scott Fritzen

constructions prior to the NHSP, while several others were only
"semi-solid." All were classified as "solid" after construction with NHSP
finance.
Less heartening is the finding in Table 2 that CHCs that had
been built with project funds over two years before the VNHS interviews
actually had a higher need for repairs than matching communes (82percent compared with 72 percent). Systems for the actual maintenanceand repair of CHC facilities are by implication no better in project thanin non-project areas, with important negative consequences for the
long-term sustainability of the investments.
Both findings are consistent with findings from the field.
Physical inspection of the facilities found many weaknesses in thequality of construction. Fully 10/16 communes have leaking ceilings
and/or cracked walls. Some of the CHCs suffered this problem after only
one year of operation. How communes deal with repairs varies. Only twoof the CHCs surveyed knew the period for which the contractor insures
such repairs (one year). About 25 percent of CHCs stated they sought
funds from the commune authorities for repairs, while the rest stated theywould either have to pay for the repairs themselves or would simply "livewith the problem." Quality control in project-financed construction was
generally inadequate and the design of the project neglected sustainability
considerations.
Management problems were also evident in the construction
process, particularly in high mountainous areas. Two CHCs surveyed in
Son La province still had not been hooked up to the electricity network
three years after construction, though the commune itself had long been
electrified. In one of these CHCs, no water was available on the premises,
causing significant hardship to staff and patients as well as problems withcleanliness. In Section 4.3, we will return to the implications of thesefindings in the examination of institutional hypotheses.

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4.2. "Outcomes" Hypotheses (H2): Impacts on Utilization andPreventive Service Quality
This and the following section look at the overall outcomes thatmight be attributed to the upgraded infrastructure, before looking at thecausal pathways that might explain such outcomes.
Table 3: Basic Data on Utilization of CHCs and DHs,and Referral Function of CHCs, in Project and Matching Areas

Inpatients at CHC per 1,000 interviewees in past 12 months
Percentage of all inpatients that were inpatients of the CHC
Outpatients at CHC per 1,000 interviewees in past 12 months
Percentage of all outpatients that went to CHC
Percentage of self-medication in all health-seeking behavior
Percentage of those with illness who do not go for any consultations
Referral function:
Mean number of patients referred by CHC to a higher level facility per capita

All Project Matching
N=88
N=217
24.5
18.4
13.8
12.2
983.8
732.3***
24.5
18.4***
71.6
74.9***
71.8
75.2***
9.79

7.2

Note: Two-sided t-test for difference in means significant at p<.10 level; ** <.05; *** <.01;
outpatient and inpatient rates are visits per 1,000 households interviewed in VNHS.

Source: Author's field survey.

Figure 1: Percentage of Outpatient Visits by Commune Residents
conducted by CHC and District Hospital in Project and Matching Areas% all outpatients who go to facillity

60
50
40
30
20
10
0
project

matching
CHC

District hospital

Note: 88 project and 217 matching communes

Source: Author's field survey.

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Scott Fritzen

Utilization. One key outcome assumed and desired by the
project was increases in the utilization of the CHCs. Table 3 lays out thebasic data from our VNHS sample for CHCs and District Hospitals(DHs) in project and matching areas. Four findings stand out.
First, both inpatient and outpatient rates in project CHCs are
marginally higher than those in matching communes.
Second, the effect of the project is also evident when examining
the percentage of all outpatient consultations conducted by the DHs andCHCs (Figure 1). This percentage is seven percentage points higher for
CHCs, and no difference is found in the percentage of inpatients treated.
Third, the percentage of self-medication in all health-seeking
behavior, as well as the percentage of households reporting illnesses who
fail to go for any consultation, are both marginally smaller in project
areas, again suggesting that the CHCs are being more heavily utilized.
Finally, the referral functions of CHCs (to higher facilities) may befunctioning somewhat better in project than in matching areas, though
the effect is not statistically significant.
Disaggregating the health services in CHCs by socioeconomic
characteristics reveals that these services are being used most heavily by
the poorest households (in proportion to their population share) (Table 4).
This finding, which was consistent across the two Vietnam Living
Standards Surveys in 1992/93 and 1997/98, is confirmed by our VNHS
sample, as well as by the field assessment team. However, increases inutilization in the project area are, according to the project/matchingcommunes comparison, being driven by large increases in the numbersof CHCs used by the non-poor.
Preventive Service Quality. To what extent can investments ininfrastructure be expected to have an impact in the area of preventive
services, such as implementation of the national programs combating
tuberculosis and malaria? Component 1 investment focused primarily on
supplies (with some training beneficial to national program delivery).
The primary mechanism by which the NHSP could upgrade preventive
health activities would be improved facilities for meeting and organizing

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Table 4: Utilization of Health Services by Socioeconomic
Characteristics in Project and Matching Communes
Outpatient
Expenditure Quintile
Poorest2
3
4RichestInpatient

Project(N=835)

Matching(N=1566)

Project(N=111)

Matching(N=228)1793.1
1965.7***2063.3***1770.8***1625.5***1754.91660.71542.61160.1807.4

47.2**
40.4***
53.1***
70.4**
80.8**

34.7
26.2
24.9
38.4
18.8

Note: ** and *** mean statistically significant at 5 percent and 1 percent significance level,
respectively.

Source: Author's field survey.

activities, provision of in-service training, strengthening the village
health worker network via in-service training and basic equipment provision,and improved morale of health workers.
Fieldwork in the five provinces focused on the assessment ofthese possible impacts. The field teams found strong evidence of anincrease in the effectiveness of national programs in the past five years,
some portion of which can be traced to project investments and their
indirect impacts:· Newly constructed health centers served as more effective
command centers for preventive service programs. Better
infrastructure created better working conditions for, andimproved the morale of, commune health staff, with demonstrable
positive effects on maternal and child immunization andinformation, education, and communication (IEC) activities.
· Direct and indirect effects of in-service training for both
CHC staff and village health workers influenced the qualityof preventive health activities. Workers assessed highly thecontribution to their knowledge of the various programs
concerning preventive health services, including content related
to IEC, epidemiological monitoring, supporting the children andmother vaccination program, and conducting the malaria andtuberculosis prevention program.

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Scott Fritzen· Of particular note was the impact of improved morale(derived from the combination of in-service training andinfrastructural upgrades) on the likelihood of long-term careerdevelopment of health personnel at the grassroots.
· Examination of the malaria and tuberculosis prevention programs
suggested that drugs provided through the NHSP had apositive impact on program implementation in some areas.
How does this optimistic overall assessment from the fieldmesh with results from the VNHS, which adds to the picture the structured
comparison with matching communes? A basic review finds there are
only marginal differences between project and non-project areas along
almost all of the indicators comprising a "preventive health service quality"
composite indicator (see Appendix), including no difference in thenumber of programs which the CHC reports implementing, and amarginal difference in the number of contacts reported by householdswith national programs. Yet the relatively small differences that do exist
are enough to make the quality indicator statistically significant in the
project's favor.

Table 5: Preventive Service Quality Composite Indicator Averages by Selected
Socioeconomic Characteristics in Project and Non-project Areas
Socioeconomic Characteristics
Ethnic Composition
Primarily minority communes
Primarily Kinh or Hoa
Household Expenditure Quintile
Poorest2
3
4RichestAverage education level of adult women in household
Illiterate and/or less than primary education
Primary and/or some lower secondary education
Secondary education and above

Project

Matching

1.50
2.24

1.63
2.05

1.89
2.13
2.15
2.19
2.30

1.77
1.98
2.04
2.03
2.09

1.99
2.11
2.13

1.83
2.00
2.06

Source: Author's field survey.

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Examining the same composite indicator by ethnic category(whether or not a commune has a substantial minority population,
household expenditure quintile, and female education) reveals systematic
disparities along all of these indicators in both project and matchingcommunes. While the project does not appear to reduce disparities, itdoes raise the absolute levels of the more disadvantaged compared withmatching communes in all categories, except ethnic minority communes.
By this measure, project benefits are reaching the poor, even thoughinequalities are not reduced.
4.3. "Outputs" Hypotheses (H3): The Role of Institutional Quality
in Explaining the Impacts
The above analysis reveals statistically significant, thoughgenerally modest, impacts of the project on boosting CHC utilization rates,
along the order of 10 percent increases in utilization for both inpatientand outpatient utilization. Yet the overall picture is highly diverse, with asignificant minority of project communes experiencing no increase inutilization, or even declines. Project contributions to the "supply side" in theabove model are an important contribution to increasing utilization of CHCs.
Their effect varies depending on how they interact with the demand side andinstitutional factors. Impacts on preventive service provision appeared to begenerally positive, even though these failed to reduce inequalities between
poorer and richer localities.
How best can this pattern be explained? Central to the supply-side
approach was the assumption that through it, the project would be able toaffect worker morale and commitment to the sector. The quality of local
institutional environments is of enormous importance to the realization ofproject aims. Such analysis might begin with an attempt to describe potential
mechanisms for improving the pressures and incentives to perform on CHC
staff. The pattern of these pressures is likely to explain both the modest
impact of this supply-side project as well as the remaining large disparities
in infrastructure quality, utilization patterns, and preventive service quality.

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Figure 2: Pressures and Incentives underpinning CHC Performance: A Framework
Central / Provincial
authorities

Provide information / raise
expectations on rights

Policy direction /communicating
standards / resources

Commune People’s
Committee

3. Resources /Supervision

Feedback / pressure (also
via other organizations)

Policy direction /resources

Key:
Admin.
accountability
Political
accountability

District healthofficeCompetitive pressure

4. Technicalsupervision
CHC staff(5. Professional
norms)

2. Competitive
pressures

Privateproviders

1. Feedback / resources(user fees / contributions

Community / Users

Source: Author's illustration based on field survey's findings.

Fieldwork findings were used to develop a typology of differentpressures observed, weakly or strongly, singly or jointly, in the 16
communes surveyed. Figure 2 summarizes the results. Pressures for
performance may come from five potential sources, which we number
for reference:
Mechanism No. 1: Users, who—to the extent they are sufficiently
empowered with information on their rights and the quality of services
and enjoy a range of choices—can "vote with their feet" and patronize themost responsive providers. Their influence is heightened to the degreeuser fees raised from them are an important source of revenue to the CHC
or salary supplementation to the workers therein, and to the degree thatthe local authorities are sensitive to user feedback on CHC performance;
Mechanism No. 2: The private sector (and, indirectly, public
sector hospitals), which to the extent they are developed provide intheory competitive pressures on CHCs (all are competing for the samegroup of potential patients);

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Mechanism No. 3: The political authorities, namely the People's
Committee (and, in places where they are proactive, the People's
Councils), who in theory can hold CHCs responsible for meeting
minimum standards or higher, and who may provide supplemental funds
for this purpose (funding which raises their stake in CHC performanceand hence their monitoring effort);
Mechanism No. 4: Technical authorities, i.e., the district healthcenter, responsible for supervising all technical aspects of the CHC workand probably in the best position to assess the actual quality of services
being provided; andMechanism No. 5: Internal sources of motivation, such as astrongly internalized sense of professionalism or of service to the people,
which may be influenced by locally variable organizational cultures ofservice delivery.
This figure presents only a hypothetical set of such pressures.
The most outstanding finding is that there is significant variation in thestrength of the mechanisms above in the surveyed localities. In the bestcases, several of these mechanisms are operative to at least a significant
degree; such CHCs had the best observed outcomes in terms of curativeand preventive health service quality. Yet some surveyed communes,particularly but not exclusively in mountainous localities, suffered fromthese mechanisms not functioning effectively or not functioning at all.
These were communes:· Where users were reluctant to complain about CHC
performance;· Where there was little or no competitive pressure from theprivate sector, or the pressure was in fact dysfunctional as
CHC workers were privately providing services that could
have been provided by the center itself;· Where commune authorities evinced no particularunderstanding of, or interest in, the workings of the CHC, andcontributed little if any revenue to the centers;· Where district supervision was episodic, focused on numericaltargets rather than technical support, and generally irrelevant

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Scott Fritzen

to improving CHC performance from a strategic perspective;and· Where norms of staff behavior, i.e., the organizational
culture of the CHC, were inimical to service quality.
The bulk of communes fell somewhere in between the two poles
just described.
How does this relate to the NHSP? Several project interventions
assume (generally without analysis) the existence of, and/or seek toreinforce, the accountability mechanisms described above. At least four
specific effects on the institutional environment were hypothesized by
the project:
H3: Building "shiny new" CHC facilities will improve:(i) health worker morale [Mechanism No. 5];(ii) commitment of the local authorities to the health sector[making use of Mechanism No. 3]; and, via these two
impacts,(iii) the improved supervision and management of the centers[Mechanism No. 4]; all of which should culminate in(iv) improved community perceptions of PHC quality[Mechanism No. 1].
In what follows we examine each of these potential impacts.
H3(i): Impact of project investments on staff morale.
Evidence from the field assessment team is strong on this point:
improvements to CHC facilities were highly appreciated by CHC staff,
who in many cases reported working with greater enthusiasm in theirmore comfortable surroundings. This makes sense, as many daily tasks
that are heavily affected by the facility structure, e.g., maintaining
cleanliness, drawing water, filing paperwork, and attending to multiple
patients in different examination rooms, are made easier to perform by
better infrastructure. The fact that facilities were maintained in asignificantly cleaner state in project than in matching communes
provides indirect evidence for this effect on morale.

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H3(ii): Impact of project investments on commitment of local
authorities. The Commune People's Committees could in theory becalled upon to perform a range of functions, including:· actively intervening to ensure high service delivery standards
in cases of citizen complaints, coordinating intersectoral
activities, e.g., health checkups in schools;· mobilizing people's contributions to infrastructure upgrading
funds; and· supplementing CHC budgets directly.
All of these functions (as well as their absence in many
communes) were observed in some communes during fieldwork. Yet one
indicator of "local authority commitment" (as measured by thepercentage of commune budget allocated to the CHCs) emerged as moststrongly influencing CHC service quality in this regard: supplementationof CHCs from commune budgets.
Table 6: Commune Budget Contributions to the Health Sector
in Selected Fieldwork Communes
SON LA
Hat Lot
0.2 percent of total
commune budget fornational programs

Chiang Mai
No expenditure

PHU YEN
Son Thanh
0.5 percent ofcommune budget for
preventive healthcampaigns

An Dinh
1 percent of commune
budget for preventive
health campaigns

QUANG TRI
Trieu An
Vinh Long
3 percent total
8 million VND allocatedexpenditure for both
per year from arecurrent and preventive community contribution
health campaigns
fund, for general use by
CHC
SOC TRANG
Thanh Phu
Same as An Dinh

Nhin Ma
No expenditure; CHC
raises funds throughuser fees

Source: Author's field survey.

Fieldwork findings demonstrate, as in most areas, significant
variation in the degree to which commune authorities could supplement
local budgets. VNHS findings confirm this. Commune contributions
varied significantly, both in absolute terms and as a percentage of the73

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Scott Fritzen

overall commune budget; where the latter was highly restricted, as for
mountainous communes, allocations were typically minimal. Table 6
summarizes a variant of the "commune budget commitment" variable infieldwork communes: the degree of commune budget contribution tofund preventive health (national) programs, underlying this diversity. In
aggregate, no significant difference was found between project andmatching areas in commune commitment.
H3(iii): Project impact on management and supervision quality.
Evidence of a strong project effect on the management quality of thecenters is not evident in fieldwork communes, given huge variations
observed in practice within the project area. The evidence is mixed in the
VNHS data. A composite indicator for management quality (comprising
several variables such as maintaining accessible hours, outreach topeople's homes, supervising private sector providers and village healthworkers, and maintaining good records) is virtually identical between
project and non-project areas in the aggregate; but for localities that had
implemented the project for more than two years, significant positive

Figure 3: CHC Management Quality in All Project Communes and Matching Communes
2.50

2.00

1.50
all project> 2 years project< 2 years projectmatching

Note: Management quality composite indicator coded 1 for below average performance; 2 for average;
and 3 for above average. All project communes are disaggregated by time since infrastructure
upgrading was completed.

Source: Author's field survey.

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deviance was observed (Figure 3). Fieldwork evidence suggests that
CHCs were most utilized, best maintained, and in general had the highest
impact on PHC quality in those areas that were already well managed(due in most cases cited to particularly committed individuals acting as
CHC chiefs) prior to NHSP investments.
Would project implementation and training provide an impetus
for districts to supervise the newly rebuilt health infrastructure morethoroughly? A composite indicator comprising questions from the VNHS
on how often district personnel visited CHCs in the last year, and how
many areas they supervised or provided feedback on, was created.
Applying this indicator to only those CHCs in districts where district
personnel had received module 4 training more than 12 months prior to
the interview, no difference was found in supervision patterns between
project and matching areas. Significantly changing supervisory behavior
in the absence of changing incentives and capacities (beyond merely
providing a theoretical justification for better supervision in the training
sessions) is likely to be nearly impossible. Such patterns are highly
dependent on the existing quality of institutional environment, such as
the demand on the part of the political authorities for high quality PHC
to be provided (and hence greater pressure on the district personnel tointervene to maintain minimum standards).
H3(iv): Impact of project investments on community perceptionsof facility quality. Community members rate the quality of care to besignificantly higher in project compared to matching communes,
although fieldwork results suggest their perceptions vary significantly
within the project area. A composite indicator was calculated based on a
range of questions posed to those who had utilized CHC outpatient andinpatient services. These questions asked respondents to assess service
quality along a number of criteria, such as availability of modern
equipment, knowledgeableness of staff, waiting time, and paperwork
requirements. When responses are combined, we are left with a composite
indicator again coded from 1 to 3 for below average, average, and superior
performance of a CHC, respectively.

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Figure 4: Perception of Users regarding Inpatient and Outpatient Service Quality
in Project and Matching Communes
2.50

2.30

2.10

1.90

1.70

1.50
project
perception (outpatient)matching
perception (impatient)

Note: Based on aggregation of perception-related questions in VNHS, before recording to 1 forbelow average; 2 for average; and 3 for above average performance.

Source: Author's field survey.

Figure 4 presents the results. Perceived quality of both CHC
outpatient and inpatient services is higher in project areas, although thedifference is only statistically significant in the case of outpatient services.
Since the effect of the project on community perceptions ofquality is of great importance to efforts to increase utilization, somedeterminants of these perceptions are examined in an ordered logit
model. In addition to the effect of receiving project investment, theeffects of PHC supply and institutional factors on user perceptions arealso primarily important. Infrastructure quality, CHC budget adequacy,
and district supervision all have positive effects on user perception (viatheir presumed impact on quality of services offered in the center); thenegative (and significant) coefficient on staffing adequacy is puzzling
here. The effect of being in the NHSP is positive, but its statisticalsignificance is watered down by its collinearity with infrastructure
quality. The model broadly confirms the importance of supply andinstitutional factors in boosting CHC service quality, and via that,
community perceptions of the PHC.
Overall, the evidence above points to one conclusion: thesupply-oriented NHSP is unlikely to have had a consistent independent76

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From Infrastructure to Institutions: Reforming Primary Health Care in Vietnam

Table 7: Ordered Logit Model for Determinantsof User Perceptions of CHC Outpatient Services
Dependent variable: User perceptions of CHC outpatient health services
Coefficient(composite: 1-3)
PHC supply factors:
Staffing adequacy (composite indicator coded 1-3)-.46*
Total value of CHC drug stock-.00002
CHC infrastructure quality (composite).46**
CHC budget adequacy (total revenue of CHC)
.70***
Institutional factors:
District supervision (number of visits in last year).03**
Commune budget commitment to CHC (composite indicator coded 1-3 based on.059
percent of commune budget allocated to health)
CHC management quality-.07
Additional effect of NHSP:
Project-invested commune? (Dummy variable).15N
150(a)k2(9)15.75
Prob > k2
.07
Cuts
.21
2.25

Note: *; **; and *** mean statistically significant at 10 percent, 5 percent, and 1 percent
significance level, respectively. (a)N here is lower than total project and matchingcommunes due to missing data on some of the composite indicator constructions.
Source: Author's estimates from field survey data.

impact on local institutional quality, although it might have been an
enabling factor in areas that are already supportive.
However, the evidence very well supports the converse relationshipthat institutional quality affects project output quality. Two findings arenoteworthy. First, there is a often a strong correlation between different
indicators underpinning institutional quality: institutional quality indicators,e.g., commune budget commitments to the CHC, district supervision,and CHC management quality, tend to be correlated in practice.
Pressures for good management performance in communes falling in
category three on the commitment indicator will be reinforced by anumber of other mechanisms. The opposite is true for communes facing
poor-quality environments in category 1.
Thus, institutional quality as assessed along these indicators has
a considerable impact on the quality of project outputs (rather than viceversa, as argued above). For instance, the assessed management quality
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Scott Fritzen

of a CHC has a strong bearing on whether CHC infrastructure falls into
the highest-quality category or not (Figure 5); and this effect is similar inproject communes and matching communes.
Figure 5: Infrastructure Composite Indicator by Commune Management Quality(Project and Non-project Areas combined)
infrastructure composite

infrastructure quality (composite indicator)

2.5

2

1.5

1

1

2

3

management quality (composite indicator)

Note: Details on the construction of infrastructure and management quality available in Appendix.
Both are coded 1-3 based on below (1) or above (3) average performance.

Source: Author's estimates from field survey data.
Figure 6: Impact of "Local Authority Commitment" (Allocations to CHC as a
Percentage of Commune Budget) on Six Composite Indicators of Project Performance
infrastructure
2.50

CHCs in average- or lowcommitment communes
equipment

vhw network

1.50

drugs

dist supervision

CHCs in high-commitmentcommunes
training

Note: N=88 project communes. All composite indicators above are coded 1-3 based on below (1) orabove (3) average performance (see Appendix for the details on construction of these indicators).
"vhw" means Village Health Workers.

Source: Author's estimates from field survey data.

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Figure 6 looks at the impact of commune budget commitments(in a pattern that is exactly the same when, for instance, disaggregated bymanagement quality composite indicator) on five composite indicators
representing different areas of project investment. In all cases, CHCs
with higher than average commitment by local authorities are able toperform significantly better than those in low-commitment communes(as assessed by this indicator, which focuses on the percentage ofallocations of the commune budget to health activities). The impact of
this specific institutional variable may also serve to emphasize again theimportance of local recurrent financing to ensuring adequate levels of
project implementation, something arguably neglected in the design ofheavily supply-side projects.

5. Policy Discussion
Extending "coverage" of the rural population to basic healthservices has traditionally been the strength of Vietnam's health sector, via
its extensive system of some 10,000 Commune Health Centers (CHCs).
It was this system that was in disrepair and deterioration in the early
1990s when the project reviewed here was being conceptualized. It is no
surprise that project investments were overwhelmingly on the "supply
side" of the health system, i.e., on those inputs which could be procured,
distributed, or organized by the Ministry of Health (MoH) acting morethan its own. Such investments are well suited to the purpose of expanding
coverage, or, to be more precise, of raising the quality of infrastructurethat had in many places so deteriorated that it no longer "covered" muchof anything.
Almost ten years later, there is strong evidence that Vietnam's
health sector has not only emerged from serious organizational disruption
suffered during the early transition, but has solidified and improved thequality of its system of primary health care (PHC) delivery (NCSSH,
2001). Whereas previously a CHC providing theoretical "coverage" to acommune population might have been understaffed, unequipped, and in79

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Scott Fritzena facility on the verge of collapse, such cases are increasingly rare evenin remote areas. Projects, such as the National Health Support Project(NHSP), made a significant contribution to this rebound.
Boosting the quality of service coverage at the commune anddistrict levels in this way was highly appropriate from an equity perspective.
Investments in grassroots PHC are pro-poor: the poor use CHC and district
hospital services more heavily than their share in the population suggests,
in large part because those who are better-off typically gravitate towards
higher quality providers in district, provincial, and even central level
hospitals. The poor, who stand to gain most from reductions in mortality
rates from preventable causes, also benefit disproportionately from theimproved operation of CHCs as the primary bases from which preventive
health services are delivered.
These health sector accomplishments remain uneven, however.
A substantial number of CHCs—primarily, but by no means exclusively,
in mountainous localities—are failing to achieve or sustain minimum
standards of PHC quality or to boost utilization. Since these communes
typically have a high proportion of ethnic minorities and/or poor households
across the board, such failure is having serious equity consequences.
Disparities in some supply factors, such as infrastructure quality, canbe reduced with sufficient investment; but the findings of this paper
suggest the persistence of an "equity gap" that this is not bridgeable by asupply-driven, facility-based project alone.
Instead, two types of interventions will be increasingly
important given the heightened priority given by health planners
to equity concerns. The first area is a focus on improvements to theinstitutional environment underpinning CHC performance. A framework
for analyzing the set of pressures and incentives felt by CHC personnel
and various other key stakeholders is proposed in the paper (Figure 2).
Much work remains to be done to identify mechanisms for increasing thepressures for responsive CHC performance while ensuring an adequate
flow of resources to them for meeting minimum standards. The second
area is greater attention to the demand side of interventions underpinning80

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From Infrastructure to Institutions: Reforming Primary Health Care in Vietnam

health quality and access, i.e., interventions aiming to increase basic
health knowledge and to influence the demand of individuals forbasic services, such as maternal immunizations and antenatal care. One
prevalent demand-side innovation in the Vietnamese policy environment
at present is the focus on getting health insurance into the hands of thepoor. In several communes surveyed, this has already been seen toincrease utilization of CHC and district hospital services.
Another major implication of the analysis here is the need
to work out effective institutional arrangements for health sector
decentralization (Fritzen, 2000). Utilization rates for CHC services
are diverse at the grassroots for a host of reasons that can only partly
be influenced by supply-side factors. Rather than trying to make"one-size-fit-all," i.e., to have one model for the services that CHCs areequipped and financed to deliver to minimum standards, the attemptshould increasingly be to maximize the returns on scarce public investmentin the health sector from both equity and efficiency perspectives. It isalready clear that a wide range of rural clinics (over half of our sampleof 315 CHCs) have virtually no inpatient visits. Yet newly propagatednational standards for all CHCs to the year 2010 emphasize larger
facilities that would be more costly to construct and maintain and which
despite this would not necessarily reverse locality-specific patterns ofutilization. Just as urban CHCs are constructed to different specifications
and are seen to play a different role in urban health delivery from thosein rural areas, greater diversity in health planning is needed for rural
areas. Such diversity may extend to include models that are region-specificand a structured menu of investment options that can be placed under thediscretion of provincial and district authorities to adjust periodically.
In rethinking investment patterns, the issue of how to protect
and further develop the quality of preventive service activities should beurgently considered. These services will remain essential functions for
all CHCs to perform. Seeking to build and maintain all CHCs to more orless the same specifications arguably starves resources that can be targeted
to preventive health functions that are probably under-funded relative to81

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Scott Fritzen

their social value. In practice, under current CHC financing arrangements,
the quality of preventive services is partly dependent in many CHCs on
their success in boosting utilization. This is not good news for a numberof communes, which, for many reasons, will fail—even with infrastructurethat is "shiny new"—in generating such increases (for instance, thoselocated close to district hospitals).
The "first generation" of PHC policy in Vietnam resulted inwidespread coverage of the rural population to health services. The NHSP
has been part of the attempt to meet the "second generation" challenge ofimproving evenness in the quality of key supply-side factors, including
staffing, infrastructure, and drugs, in more disadvantaged areas of thecountry. To consolidate the gains that have been made in this regard overthe past ten years, we can anticipate a "third generation" of challenges inVietnam as well as other transition settings:· Moving towards decentralized health sector planning andfinance, while maintaining minimum standards in key areas;· Putting health "purchasing power" in the hands of poorer
households, and boosting their access to information to
guide their health-seeking behavior; and· Improving the institutional environment underpinning local
health system performance, which at present is in many
respects hampering progress in achieving high-quality
health care for the poor.

References
Chen, L.; and L. Hiebert. 1994. From Socialism to Private Markets:
Vietnam's Health in Rapid Transition. Cambridge, MA: Harvard
Center for Population and Development Studies.
Fritzen, S. 1996. "Health-sector Decentralization in a Transition
Economy: The Case of Vietnam." The World Bank, Background82

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From Infrastructure to Institutions: Reforming Primary Health Care in Vietnam

Report for Country Economic Memorandum Fiscal Decentralizationand the Delivery of Rural Services, mimeo.
_______. 2000. Decentralization and Local Government Performance:
A Comparative Approach with Application to Social Policy Reformin Vietnam. Ph.D. Dissertation, Princeton University.
_______. 2002. "Growth, Inequality, and the Future of Poverty
Reduction in Vietnam," Journal of Asian Economics, 13: 653-667.
Mehrotra, S. 1997. "Social Development in High-Achieving Countries:
Common Elements and Diversities," in S. Mehrotra and R. Jolly(eds.) Development with a Human Face: Experiences in Social
Achievement and Economic Growth. Oxford: Clarendon Press.
National Center for Social Sciences and Humanities (NCSSH). 2001.
National Human Development Report 2001: Doi moi and Human
Development in Vietnam. Hanoi: The Political Publishing House.
Nguyen, N. N. 1997. Health Sector Development and Economic Reform
in a Transitional Economy: Vietnam 1989-1997. Ph.D. Dissertation,
University of Manchester.
Osteria, T. 1997. "Social Development in the Asian Region: Policy Issues
and Challenges," in J. Ismael and E. Hill (eds.) Social Welfare
and Social Development: Asian Experiences. Calgary: Detselig
Enterprises Ltd.
Ramesh, M., and M.G. Asher. 2000. "The Political Economy of Social
Policies," in Ramesh, M., and M.G. Asher (eds.) Welfare Capitalism
in Southeast Asia: Social Security, Health and Education Policies.
London: MacMillan Press Ltd.
Smithson, P. 1993. "Health Financing and Sustainability in Vietnam."Hanoi: Save the Children Fund (UK).
Socialist Republic of Vietnam (SRV) and Donor Working Group on
Public Expenditure Review (2000). Managing Public Resources
Better: Public Expenditure Review 2000. Hanoi: World Bank.

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Scott Fritzen

Tran, T. 1995. "Historical Development of Primary Health Care in
Vietnam: Lessons for the Future." Cambridge, MA: Takemi Programin International Health, Harvard School of Public Health.
World Bank. 1992. "Viet Nam: Population, Health and Nutrition Sector
Review." Population and Human Resources Operation Division,
Country Department I, East Asia and the Pacific Region.
Washington, D.C: World Bank.
_______. 1995. "Project Appraisal Document: The National HealthSupport Project," mimeo. Hanoi: World Bank.
_______. 1996. Viet Nam: Poverty Assessment and Strategy, Country
Operations Division, Country Department I, East Asia and the PacificRegion. Washington, D.C: World Bank.
_______. 1997. Financing Health Care: Issues and Options China 2020
Series. Washington, D.C: World Bank.
World Bank and Donor Working Group. 2001. "Growing Healthy: A
Review of Vietnam's Health Sector." Hanoi: World Bank.

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From Infrastructure to Institutions: Reforming Primary Health Care in Vietnam

Appendix: Composite Indicator Construction

Composite indicators were constructed based on combinationsof answers to the National Health Survey questions. The intention is tobroadly distinguish between significantly above and below average
performance in different areas, and to broaden both the robustness andthe theoretical significance of indicators used in the analysis. All composite
indicators are coded 1-3 based on whether the result of the additions(weighted as shown below) places a commune in the bottom 25 percentileof the combined (project and non-project) distribution (coded 1); 25-75
percentile (coded 2); or above 75 percentile (coded 3). The following
summarizes key indicators used and any weights given.
1. Infrastructure quality composite: solid construction; need for repair;overall cleanliness as assessed by surveyor; room availability withfour functions, and whether facilities for hand washing area are available
in each room.
2. Equipment: 60 percent weight for availability of equipment that is in
working state, based on 17 items listed in survey form; 20 percent
weight for availability of essential chemicals and supplies listed; and20 percent weight based on difficulties encountered in sterilization.
3. Drugs: Composite of 50 percent weight given to availability of drugs
from 20 listed on form and 50 percent weight given to the total valueof the drug stock in CHC.
4. Training: Average number of areas in which in-service training had
been provided to at least one CHC personnel in past 12 months (outof 19 areas).
5. District supervision: Number of district supervisory visits to the
CHC in the past 12 months.
6. CHC budget: Total revenue of CHC.

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Scott Fritzen

7. Staff: 30 percent weight given to the overall number of CHC staff; 50
percent weight given to whether the commune meets national standards(different for mountainous and delta regions); and 20 percent weight
given to whether the CHC has a doctor.
8. Commune commitment: Average percentage of commune budget
allocated to CHC in 1998-2000.
9. Management quality: 20 percent weight given to district supervisory
visits to CHC; 15 percent to completeness of record keeping in CHC;
10 percent to supervisory activities of private sector providers; 35
percent to the opening hours of the CHC and whether a night-shift isorganized; 20 percent to the number of supervisory visits made tovillage health workers in past 12 months.
10. Village health workers (VHW): 25 percent weight to VHW knowledge
as revealed on standardized test in NHS; 25 percent to the coverageof villages with a VHW in the commune; 25 percent for the contact
rate of VHW with the population for services; and 25 percent for thenumber of activities performed by the VHW.
11. National preventive health quality: 40 percent weight for number ofnational programs implemented in commune; 30 percent for averagetime spent in one week on national program activities; and 30 percent
for strengthening VHW network (as calculated above).
12. Perceptions of the quality of inpatient and outpatient services:
Answers to questions on quality of facilities, availability of medicine,
waiting time, paperwork burden, and service attitude of staff arecoded 1 if "average" and 2 if "good." Results added before division
into 1-3 made based on percentile rank as noted above.

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Chapter 4
Between Nurturing and Nurtured Childhood:Children Working in the Streets in Hanoi
Aiko Takai

Abstract
Based on case studies carried out in Hanoi during August-November
2005, this paper argues that globalization has entailed a widening gap
between the childhoods of the poor and the wealthy children. The gap is
between the nurtured childhood of the upcoming urban middle
classes and the nurturing childhood of the poor. By opposition to theWestern-inspired nurtured childhood, nurturing childhood finds its
inspiration in re-invented Confucian value. Poor children are, from theirearly childhood, raised as productive members of the family and carry
the burden of morality and filial duty on their small shoulders. Based on
this pattern of upbringing, children feel responsible for the family, even
if it means that they have to make sacrifice themselves. Exploring the
traditional Confucian values and the impact of socio-economic changes
in a context of economic transition, the paper contends that while thelifestyle of children from the upper classes has come closer to that of
their Western peers, the poor children's lifestyle has increasingly been
distanced from it.

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Aiko Takai

Acknowledgements
I would like to thank the participants of The Second Vietnam
Development Forum-Tokyo Conference on the Development of Vietnam
held at the National Graduate Institute for Policy Studies (GRIPS) on 15
July, 2006 in Tokyo for useful comments and suggestions.
I am particularly grateful to Mr. Giang Thanh Long for hiscomments and editorial suggestions to improve the previous version of
the paper. Special thanks go to Dr. Olga Nieuwenhuys (University of
Amsterdam) for her research encouragement with thoughtful comments.
I am alone, however, responsible for the contents of this paper.

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Between Nurturing and Nurtured Childhood: Children Working in the Streets in Hanoi

1. Introduction
In the past two decades, street children in the developing world
have captured a growing concern among national and international
development organizations, academics, and the media. Policy interventions
have ranged from an international rights convention, national legislations
to local charitable aid programs, and interventions in order to help street
children get a "proper childhood." Although the United Nations
Declaration of Human Rights adopted in 1948 ensures all people therights to defend and practice their own culture, the United Nations
Convention on the Rights of the Child (CRC) claims uniformly
entitled rights to a decent childhood for all children regardless of theirsocio-economic situation or cultural background. The underlying
assumption in this contradiction is that despite the existence of multiple
cultures of childhood, only one particular form of childhood—the onethat evolved in modern Europe and North America—would be in compliancewith children's rights. As a result, other forms of childhood are treated asanomalous or inferior, transforming "development" into the endeavor tostandardize childhood across the globe (see, for instance, Boyden, 1990;
Burman, 1996; Nieuwenhuys, 1998; and Stephens, 1995).
The current dominant valuation of Northern childhood fails toembrace the diversity of the social forces and cultural practices thatshape childhood in the developing world. Such failure leads to hiding thegrowing gap between the lives of the urban middle classes and those of
the poor. In Vietnam, due to the Confucian heritage that has longinfluenced people's philosophical foundations, notions of a "good child"appear very different from those typifying Northern childhood. These
Confucian values assign a nurturing role to children that contradict what
is suggested by common understandings of "civilization" and "development."
Stephens (1995: 13) writes that "while many argue that international
cultural-rights discourses further the best interests of children themselves,in some contexts these discourses may be linked to significant risks tothe physical, psychological, and social well-being of children." In the89

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Aiko Takaicase of children working on the streets, it is particularly so because
the category "street children" has been wrongly associated with a social
phenomenon that would "rob" children of what is seen as a happy,
home-based childhood. The approach is also top-down; it denies that
there often exists considerable difference in perception between children
and adults. When observing children's real lives, we concur with Punch(2000: 56) that children are the most appropriate informants to consult
about their own social worlds. Throughout the fieldwork, and in particularduring data analysis, we investigated how different discursive practices
produce different childhoods, each of which is "real" within its own
regime of truth, as in James and Prout (1990: 27). This process has been
fundamental for considering the ideological distortions of Western childhood,by which other childhoods are condemned or ignored. Focusing onchildren's perceptions and everyday experiences, the central questions of
this paper are as follows: How do children in Vietnam who work on thestreet balance the opposing ideals of childhood in society? And, inparticular, how do they come to terms with the tension between "nurtured"and "nurturing" childhood?
The paper is organized as follows. First, we will discuss the gap
between what "development" has suggested as the ideal childhood andthe real childhood practices we observed in Vietnam. We contend thatthe gap between ideal and real childhood is not a matter of a lack ofdevelopment. Current mainstream development, we argue, generates a
growing gap between the childhood of poor and wealthy children not
only globally between the North and the South but also locally, amongsocial classes. More specifically, the Vietnamese cases in our study
suggest that there is a growing gulf in childhood practices between therich and the poor, in which Confucian values and the emergence of amarket economy are tightly enmeshed. Then, in Section 3, we will briefly
provide methodological details of the fieldwork conducted frommid-August 2005 for roughly 12 weeks in Hanoi. In Section 4, basedon the empirical data gathered during the fieldwork, we examine thediversity of childhood experiences in Hanoi and compare the radically90

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Between Nurturing and Nurtured Childhood: Children Working in the Streets in Hanoi

different everyday experiences of wealthy children with those of thepoor. We then will take a closer look at the real-life situations of street
working children in terms of poverty and work. Since their families arehighly dependent on their earnings, poverty is a major motivation
driving children to work on the streets. Their contribution being vital forthe family, we argue that it is crucial to understand how children perceive
their roles and place themselves in the wider context of society in Section
5 of the paper. We will discuss tensions that children face in the courseof their lives on the streets. To deal with the tensions, children preserveby highlighting the higher moral values attached to their nurturing roles.
Though it does cause pain and disappointment, the perceived gulf
between these children and those who do not need to work does not allow
the sense of exclusion from nurtured childhood to take over their lives.
Finally, in Section 6, we provide some implications derived from failureof the current mainstream development paradigm. We argue that thecurrent discourses on childhood fail to account for dynamic socio-cultural
constructions specific to the contexts in which they are enmeshed. Morespecifically, it fails to explain the childhood dichotomy in which only
wealthy children are able to emulate the Western model while poor
children seem to be fated to accept the role of nurturing, and therefore
distance themselves from this model.

2. Ideal and Practiced Childhood in Vietnamese
Context
Here we begin arguing that in current development discourse,
there is one specific form of childhood model. We will also argue thatbasically two childhood models are simultaneously at work in Northern
Vietnam: one that emulates the Western deal, and another that evolves
from the real-life experiences of those who cannot or can only imperfectly
emulate this model. We will then contend that the two models closely follow
class differences emerging from social changes that have resulted from theeconomic transformation from a closed economy to an open-market one.

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Aiko Takai

In the current development discourse, childhood is perceived as asocial stage that is unchanging and universally experienced by children
around the world and regardless of time, in spite of the fact that it ispatterned on the experiences of a small number of children in certain partsof the world. This specific form of childhood that "development" proposes
for the children of the poor is defined by UNICEF (2005) as follows.
"Childhood is the time for children to be in school and at play, togrow strong and confident with the love and encouragement of
their family and an extended community of caring adults. It is a
precious time in which children should live free from fear, safe
from violence and protected from abuse and exploitation. As
such, childhood means much more than just the space between
birth and the attainment of adulthood. It refers to the state andcondition of a child's life, to the quality of those years."This is a typical image of nurturing childhood and it is thisdominant valuation of childhood that has recently been enthusiastically
exported as ideal for the children of the South. As a consequence, otherforms of childhoods, such as nurturing childhood, are overlooked and thisleads to hiding the growing gap between the lives of the urban middle
classes and those of the poor. The gap is between nurtured childhood
typified by children from the urban middle classes and nurturing childhood
for many of the poor, is the latter being reinforced by re-invented
Confucian tradition. The distinction between nurtured and nurturingchildhood we borrow from Hecht's study on street children in Recife,
Brazil (Hecht, 1998).1
1 The binary of nurtured and nurturing childhood is based on the notions of Tobias Hecht (1998),
who portrayed two forms of childhood as experienced in the Northeastern Brazil. According tohim, nurtured childhood is experienced by coddled children of middle and upper class families.
The status of these children is highly dependent on but differentiated from that of adults. Hecht
suggests that nurtured childhood symbolizes the ideal of Western society as well as the upper strata
of Latin American society with its specific characteristics, such as protective, innocent, consuming,and playful. As we will contend in Section 4, this nurtured ideal also applies, to a certain
extent, to the upper strata of the Vietnamese society. Nurturing childhood, on the other hand, is
experienced by the children of the poor who from an early age take on responsibilities to support
the family, bring in resources, and nurture the household. With Hecht, we also believe that "thephysical setting in which nurtured and nurturing children grow up relates to the cultural
construction of their childhoods" (1998: 84). In the Vietnamese case, additionally, this relation
appears to be strengthened due to powerful social structures that emerged under the market economy.

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Between Nurturing and Nurtured Childhood: Children Working in the Streets in Hanoi

The Western childhood ideal enshrined in the CRC, as statedearlier, articulates a typical image of nurtured childhood. Ever since therights of the child were declared, it has become vital for countries suchas Vietnam to pursue this specific form of childhood to be accepted as amember of the "international community." As Nieuwenhuys (1998: 2)
claims, "the instrument is not culturally neutral but is grounded in theassumption both of the superiority of the childhood model as it has
evolved in the North and the need to impose this model on a global
scale." Ignoring significant differences in cultural backgrounds andsocial practices, other types of childhood practices are marginalized.
Moreover, it denies children's agency to deal with tensions in enacting
their childhood. As we shall argue next, this may be a very crucial aspectof the lives of poor children in Northern Vietnam.
Development for children of the poor in Vietnam in recent years
has been something of a paradox. For many centuries the values attached
to children in Vietnamese society have been inspired to Confucian
philosophy. This philosophy, originally introduced by the Chinese, hasplayed a dominant role in the family realm as well as in society. Familial
morality was central to Confucianism and children were encouraged toshow strong feelings of filial piety towards their parents. Filial piety isembedded in a broader concept of moral cultivation, through whichchildren learn to be obedient and respectful towards their parents,
relatives, and elderly people in general, and to understand and fulfil their
responsibilities towards their parents (Hojer et al., 2004). Gammeltoft
and Olwig (2005) note that expectations of filial duty have a strong
influence on ways of thinking and action in relation to children fromdifferent social backgrounds in Vietnam. Rydström (2001, 2002, 2003),
who carried out an extensive study on children's embodied morality inNorthern Vietnam, highlights the local concern with morality, virtue andethics. She argues that "morality" (dao duc) is, among other things, amatter of practicing and "behaving oneself" (an o) appropriately, avoiding"confrontations" (ngo nguoc), having "sentiments" (tinh cam), and93

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Aiko Takai"showing respect for the superior and self-denial for the inferior"(biet kinh tren nhuong duoi) (2003: 3). Vietnamese children, in particular
the poor, are raised not merely as innocent children as perceived in theWest, but with duties and obligations towards their family as well as theirsociety, rather than to themselves (Rubenson, 2005). Growing up in sucha society, the meaning of self is intimately tied to the solidarity of family.
Children are valued as a part of the collective family unit rather than as
autonomous individuals who hold independent positions in society.
Hence, collective rights weight heavier than individual interests. As amember of the familial unit, Vietnamese children do not necessarily see
their contribution to the household as "work," but rather as "fulfilling theshare," an understanding that confirms the responsibility attached to thetask (Hojer et al. 2004: 393). This "fulfilling the share" notion is strongly
linked to the way in which children learn to practice morality and show
love to their family.
Recent economic transformation in Vietnam under Doi moi(renovation) appears to have transformed this Confucian ideology. A
rapid shift from a colonial administration to a communist structure andthen to state-controlled capitalism makes it difficult to classify thechildhood models that are at work in contemporary Northern Vietnam.
Roughly speaking, children seem to grow up in a situation in which thedivergent models of nurturing and nurtured childhood are at work at thesame time. On the one hand, children's lives are shaped by notionsof filial duty that emphasize nurturing characteristics, such as being
obedient and respectful, as well as responsibilities to support the family.
On the other hand, children are informed by modern or Western notionsof vulnerability that highlight the nurtured characteristics with the needfor protection, care, play, and, above all, education. What is less clear
is how children live the modernization process and experiencesocio-economic changes from their own point of view. Particularly
missing from the analysis is how real-life experiences are affected bychildhood ideals. Investigating how actual lives of those identified as

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Between Nurturing and Nurtured Childhood: Children Working in the Streets in Hanoi"street children" correspond to the ways in which international society
and local opinions associate with this social category, this paper will
unravel the real-life situations of such children and will look at how theybalance the two opposing ideas—nurturing and nurtured—in constructing
their own childhood.

3. Data and Methodology
In this section, we will first elaborate on the choice of researchsample applied in this paper. Then we will explore chronologically how
we went about conducting the fieldwork, introducing the main methods
used to collect relevant data. We will also discuss the limitations of thispaper.
In order to clarify to which children we refer in this paper, thefollowing definition was adopted: Children under 16 who spend most of
their time on the street for income generating activities. For the purposeof this paper, we call them "street working children" or "children working
on the street." This definition is used only to select our research sample,
and it is not meant to categorize them as such. We did not employ theterm "street children" as it tends to group children into a social cluster
and label them as a problematic phenomenon. In this paper, we aim at
unravelling perceptions and real-life experiences of children working on
the street as opposed, first, to the social category "street children," andsecond, to home-based children. As for the former, children have diverse
backgrounds in family, education, and motives to be on the street, thus
they cannot be and should not be reduced to a member of one socialgroup, and as for the latter, street children are not a homogeneous socialgroup and it is a combination of different social, cultural, and economic
factors that drive them to the streets (Pare, 2003). To contrast withhome-based children, it was important to focus on children whose primal
activity on the streets was earning money.
The methodology used in this investigation is primarily
qualitative. During the first few weeks, we gathered information from95

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Aiko Takainine different organizations2 working for/with street children tounderstand the local situation regarding what has been done so far, where
and on what purpose these organizations work, and how the organizations
perceive the issues of street children. The aim of the visits was to gain
information about the local situation as regards the issue of street children
from the perspectives of the various external actors mentioned above.
Through discussions with staff members of these institutions, we wereable to obtain some knowledge relevant to our research along two mainlines: organizations' views on street children, and those of the government.
Except for local organizations, which mainly followed their own
understandings of what should be done for street children, all otherorganizations worked on the basis of the UN Convention on the Rightsof the Child. Not surprisingly, for the majority of organizations, street
children were a pressing social phenomenon that has become more
apparent during the economic transformation. Those organizations work
closely with the local authorities, while a few others were rather criticalto the government's policies.
From the beginning of the third week, we spent much timewith children investigating their viewpoints and daily experiences
through observation and repeated in-depth interviews. In total, we had
conversations with 15 children, of which seven (four girls and threeboys) from three different districts3, were our key informants. Using
participant observations to approach children was crucial to identify theparticularity of research settings as well as to build closer relations withthem. This provided us with understanding about the street environment:
where and when street workers/children mainly appear, how they spend
time, and what they do on the street. When the children had more time

2 These include four international/non-governmental organizations: UNICEF, Save the Children
Sweden, PLAN Vietnam, and EU Funded Project; two local authorities: CPFC Hanoi andNational Fund for Vietnamese Children; and three local based organizations: Xa me, Blue
Dragon, and Koto.
3 In order to make a representative sample of street children in Hanoi, we selected three different
districts: Hoan Kiem, Dong Da, and Thanh Xuan.

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to spend with us, we started open semi-structured interviews with atranslator and a checklist of questions. We interviewed the samechildren over and over and this allowed us to build rapport and obtainsome information that we had not anticipated prior to the interviews.
Through this combination of methods, we were able to gain knowledgeof how children spend their time on the street, and understand how they
saw their own work and what it meant for them to work on the streets.
Although we conducted data gathering and analysis carefully, anumber of limitations may have affected the reliability of the datacollected in the field. Considering the small size of the sample, thevalidity of the information provided by the children and the scope of themethods used may be limited. We are aware that the results of this paper
capture only a small portion of the total population and may not reflect
the whole picture of children working in the streets in Hanoi. However,
we believe that the in depth focus had its advantages. Within the limited
time, other methods would not have enabled us to obtain the depth ofqualitative data we collected. To ensure the validity of the responses, wecrosschecked the data by asking the same questions in different ways;
asking friends, siblings, or parents for confirmation; and through carefulobservations. In this way, we were able to triangulate the information, inparticular, contradictions between spoken words and actual behaviors.
The children were sometimes not able to provide correct information(particularly when it came to quantitative information) because they
were tired, they miscounted, or simply they did not remember theright answers. We suppose, to some extent, this is unavoidable when
researching human beings, specifically with children. Children are easily
influenced by their moods, and we believe one cannot always expect
them to be consistent. As for drawing generalizations, there is a clear
lack of quantitative techniques in this paper. As a supplement to thequalitative methods, we would have been able to conduct some quantitative
research such as a survey or questionnaire if we could have spent moretime in Hanoi. We are also aware that this paper is, in many respects, notobjective. Nevertheless, we have made a great deal of effort to make the97

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Aiko Takai

analysis as reliable as possible. We are confident that the qualitative
methods used and the material gathered can provide good insights on thesubject, and that future research can be based upon these insights.

4. Real-life Childhoods in Vietnam
During the fieldwork, we found considerable differences
between poor and wealthy children in both economic and social respects.
In this section, we will discuss observed childhood practices based on theempirical data collected during fieldwork in Hanoi. We begin by describing
characteristics contrasting a poor child with a wealthy child. Then, wesuggest that children are highly aware of their families' economic situation.
Knowing that their contribution is indispensable for livelihood, children
often work spontaneously, even if they do not like it, particularly when
this work takes place on the streets. For some, work is a duty they feel
obliged to perform due to their circumstances; for others, it is a voluntary
act of love towards their family.
Differences between poor and wealthy children exist not only interms of physical characteristics, but also in terms of their everyday
practices with respect to work, education, and play. In the course of ourfieldwork, we had opportunities to visit several private English lessons
open to upper-class Vietnamese children. In one school, lessons takeplace on weekends for a few hours in the morning. During the breaktime, children play soccer or other games with their peers in the courtyard.
They also go to a nearby shop to buy snacks or drinks with pocket money
given to them by their mothers. Comparing these children to poor children
working on the streets, the first noticeable difference is their physicalappearance. Although the children attending these lessons were younger
than most of the poor children we knew, the wealthy children weregenerally taller and bigger than their poorer peers. This is probably due
to the differences in nutrition. Wealthy children eat more calorie-rich andnourishing food like meat and fish, whereas poor children tend to eat
simpler and cheaper food, and rarely eat meat or fish. The clothing they98

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wear is also very different. Wealthy children dress in new and clean
clothes like European middle-class children, while poorer children wear
plain and worn-out clothing. Poor children tend to wear the cheapest
plastic sandals, whereas wealthy children wear more solid sandals inwhich they can play soccer.
Wealthy children are first and foremost learners rather thanworkers. During the school term and to a large extent during holidays,
wealthy children spend a considerable amount of time studying.
Learning foreign languages in extra schools is very common in Vietnam,
and English being the most popular. One Vietnamese teacher of English
working for a private school said how eager the parents were to invest in
their children's education. She also mentioned that the children's attitudes
change radically when parents occasionally visit the classroom. Knowingthat they are expected to study hard and perform well, children suddenly
become enthusiastic participants in class to make their parents proud of them.
The wealthy parents we met in Hanoi tended to have no morethan two children. Even if they had many siblings themselves, theyclaimed that having children nowadays would entail considerable
expense. One upper-middle-class mother was saving money for her 11year-old daughter as she wished to go to a well-known English school inwhich the three-month lesson fee exceeded her monthly earnings. The
mother devoted much time to bringing her daughter to school every day
and to different private lessons to learn English and piano. She found it
satisfying that she could fulfill her daughter's wishes.
Once we asked a group of eight wealthy children (three girls
and five boys aged 11 to 13) to draw a timetable of an ordinary day.
Besides studying at school, they appeared to spend two to five hours athome for doing homework or learning English. Girls usually spend about
30 minutes to one hour to help their mother prepare dinner and clean thetable after meals, whereas boys hardly do any household tasks. Most
wealthy children spend their free time playing with friends or watching
TV. Among boys, playing computer games was also very popular. All the99

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wealthy children we talked with go to school and bring no resources
home. Unlike their wealthy peers, poor children spend their time in totallydifferent ways. The main activity of a day is doing productive work forthe maintenance of the family. We also asked some such questions as"what is the most important thing in your life?" and "what do you want
to be in the future?" As for the former question, poor children commonly
agreed that family was the most important thing in their lives. One shoe
shining boy told me that it is a customary belief in Vietnam that family
comes first. Among wealthy children, however, for only one girl familycame first. Other answers varied from becoming rich, having friends,
playing with computer games and studying. Being confident that their
dreams would come true, wealthy children's dreams of the future werevery ambitious. They wanted to become the most famous architect, anactor, a very rich person, or the secretary general of the United Nations.
Wealthy children in Hanoi have, in broad terms, much in common
with the ideal of nurtured childhood prevailing in Western societies.
They are not productive members of the family, but consumers. Parents
take care of their children in the belief that they are innocent and in needof protection from the world of adults. Wealthy children have much time
to amuse themselves both at school and at home. As learners rather than
productive workers, the only task given to them is to achieve academicallyso as to realize their bright expectations and to satisfy their parents. In
contrast to nurtured wealthy children, poor children working on thestreets, as we now turn to contend, experience a radically different typeof childhood.
Though it may not be their sole concern, poverty plays a majorrole in prompting children to work on the streets. Among the children
involved our research, six out of seven said their family's financial
difficulty was their foremost reason to work. Born as daughters and sonsof poor parents, these children have experienced poverty from an earlyage. As they grow older, they become increasingly aware of theirfamilies' economic situations, in which lack of income or the absence ofa steady income source remains the main problem. While children in100

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rural areas leave school before completing the compulsory education andmigrate to Hanoi for work to help their families, urban children may get
support from charity organizations or private donors and be able toinclude both work and schooling in their lives. Nonetheless, both in ruraland urban areas, children are very much aware that without the money
they bring in, their families could not sustain themselves.
Take for example 13-year-old Nguyet,4 who is the youngest in
her family. Nguyet's mother, in search of a better life, migrated to Hanoi
with two children from a previous marriage. Nguyet was born after her
mother settled down in a small rented room in an almost slum-like areaof Hanoi with a new husband. Nguyet started working when she wasnine. She sells postcards and books to foreign tourists around Hoan Kiem
Lake. During the week she goes to a charity school in the morning andstarts working after lunch until after 11:00 pm. An international NGO
provides with her school uniforms, textbooks, notebooks, and pencils forfree. On weekends, as there is no schooling, she spends all day long on
the street. One Saturday, when we sat together on the edge of Hoan Kiem
Lake, she told me why she started working on the streets:"I started because my family is poor. Before I used to sellchewing gum and sweets, but now I know a bit of English so I can sellpostcards and books to foreigners. I earn about 10,000 VND to 20,000
VND5 a day. Because foreign tourists prefer to buy from small children,
I earn almost twice as much as my sister or brother. If I don't work, myfamily does not have enough money to buy food and pay for the room."
Like Nguyet, Loan is a Hanoi-born girl. She has been sellingchewing gum on the streets for six years since she was four. She hawks
on the streets near Hoan Kiem Lake with its many cafes, bars, andrestaurants. She lost her father a year ago and she lives with her motherand two older siblings in the south of Hoan Kiem district. Her 24-year-old

4 All children's names are changed in this paper.
5 At the time of our fieldwork in Hanoi, 1 United States dollar (USD) was equivalent to about 15,900
Vietnamese Dong (VND).

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sister was recently arrested by the police while selling books on the street
and has been sent to a re-education center for a period of three months.
Her 22-year-old brother also sells books, but he is an addict and spends
all his money on drugs. Being left with a mother who is also a street vendor, Loan has to work even harder to fill the gap left by her absent sisterand addict brother.
Unlike Nguyet and Loan, 15-year-old girl Huyen comes from arural peasant family in Ha Nam province (about 70 kilometers south ofHanoi). She sells fried donuts on the main streets of Thanh Xuan district,which are close to the periphery of the city. With a desolate look in hereyes, Huyen told me:"I decided to come to work in Hanoi because my family is poor.
When I was 12 (after seventh grade), my father asked me to drop out
school. My parents did not have enough money to pay the school fee forthe three of us. So I left school for my younger sister and brother. Since
then, I worked at home all day long, cooking, cleaning, raising animals,
and working on the field. But after one year, I became aware that we
could not continue living in that way. My parents are farmers but
farming doesn't yield enough for selling. We didn't have enough money
to buy food. I really didn't want to leave home, but one day I told myparents that I would go to Hanoi to work. I knew a woman from the samevillage who was already starting a small business in Hanoi. She makes
fried donuts. I talked to this woman, and she told me that I could sellthem on the streets."
Although she wanted to continue her schooling, Huyen had
accepted her father's request for her to leave school without objection.
She knew that her family did not have enough money for their subsistence
and that they had substantial debt. Three years ago Huyen's parents
rebuilt their almost collapsing house to secure one of the only assets they
still held. Having no financial means of their own, they borrowed
15,000,000 VND (equivalent to about 950 USD) from kin and friends.
Though three years have already passed, they had not been able to pay
off the debt and have no future prospect to ever return such a large

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amount of money. As the oldest daughter of the family, Huyen feltthat it was her duty to leave home to work. Her family since thendepends on Huyen's earnings of about 300,000 VND (less than 20 USD)a month—their only source of income to survive and pay for school.
Sixteen-year-old boy Dong is also the oldest child in his family.
He migrated to Hanoi from Thanh Hoa province to help his peasantparents and a younger brother. Dong told us,"I left school after the eighth grade because I knew that myparents were not able to afford the school fees. I wanted to continue but
I understood that leaving school was the only solution for my family. I
did not tell anything to my parents though, so when my teacher came tomy house trying to encourage me to come back to school, they were very
angry. They even forced me to go back to school. I told them that I would
go to Hanoi to work but they did not agree. I tried to convince them manytimes. They only let me go when I said that I wanted to work in the city
to learn something new."
Despite being aware that children's contributions would materially
improve their living situation, many parents find it difficult to allow theirchildren to take up paid work to help them financially. They feel that theurban street is a hazardous place for a small child to be. Moreover, it
could be a moral mistake to accept that their children would leave home
to bring money back for the family. Some mothers expressed a feeling ofregret but admitted that their economic situation did not allow them toprovide their children with a life like that of upper-class children. Being
ashamed for "failing" to be a good parent, these feelings are well
expressed by Xuan's mother, who was also a street vendor:"My children know that without the money they bring we could
not live. I feel sorry for my kids that they have to work on the streets.
Children from rich families can just go to school and spend their freetime watching TV or playing games, but my kids have to work to helpme pay the rent and buy food. I have considered sending my kids to richfamilies to be adopted so that they need not suffer from poverty. I do notwant them to work on the streets and I feel miserable. I tell them to stayat home to study for school."103

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In contrast to Xuan's mother, a few parents did not perceive
working on the street as something negative, but rather as part of a poor
child's natural way of growing up. In the case of 14-year-old shoe
shining boy Minh, it was his father who forced him to work. Minh had
been working since he was 4. He had managed to combine work6 withschool. Understanding his family's financial difficulties, Minh dropped
out of school after the seventh grade on his own in order to lighten his
father's burden. As his father believed that shoe shining would bringmore money home, Minh had no other option than to obey him and give
most of his earnings. He travels the half an hour bus ride from his village
in Ha Tay province every morning to work on the streets of Hanoi.
Besides farming, Minh's father works as a porter, carrying goods on hisback or shoulders; yet, his income is too unstable to depend on. Although
his older sister sends some money that she earns in a plastic factory, it is
not sufficient to meet the family's needs as a grandmother, a stepmother,and a younger sister depend on them and do not bring in any money.
Like Minh, all children involved in our fieldwork bring most of
their earnings home. As children know that their families highly dependon their incomes, expenditures on themselves were generally kept to aminimum and devoted to necessary items such as food and accommodation.
Though from time to time they would buy themselves snacks, a few
pieces of clothing or accessories, they were extremely careful not tocross the boundary that would threaten their family's survival.
As said above, financial constraints played a crucial role inchildren's decision to start working. Decisions made to work on thestreets were, significantly, almost always the child's own. While many
parents disagreed with their decisions, a number of them perceived it asa life-course of children born in a poor family. In what follows we probe
into children's rationale to work and how they relate to their specificworking place, the streets.

6 Minh used to make nons—Vietnamese traditional leaf-covered hats in his village.

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When one asks a child working on the street why s/he has towork, the most likely answer is that it is because his/her family is poor.
However, as we spent more time and had many conversations withchildren, we gradually became aware that poverty is not the only
explanation. Dong (16) works in a lively area of Dong Da district, namely
Kim Lien. The main streets are full of cafÐs, bars, and restaurants, which
attract locals in numbers. Dong usually wanders around the main streetslooking for customers in cafés or local restaurants where he has gained
a kind of right to customers above other shoe shining boys. He claims
that he came to Hanoi to work not only to support his family:
Question:
How do you find working in Hanoi?
Dong:
I feel happy.
Question:
Why?
Dong:
Because when I'm in Hanoi, I have a lot ofchances to meet people.
Question:
Would you not prefer going back to your village?
Dong:
I prefer staying in Hanoi. Of course I miss myfamily and I always want to go back to my village
but there is nothing to do there.
Question:
Will you remain in Hanoi when you get older?
Dong:
So far, I think so. Because I think Hanoi is a goodplace to earn money, to learn how to do business,and to meet people.
Unlike other children, for Dong, Hanoi was a place to findopportunities unavailable in his village. Wishing to improve his future,
he believed that staying in his village would thwart his and his family's
prospects. Though his current life in Hanoi is, he felt, quite uncomfortable,
he saw it as a first step towards his dream to open a restaurant and starthis own business in the future.
What encouraged Huyen (15) to work was slightly different as
expressed in the below conversation:
Question:
How do you find working in Hanoi?
Huyen:At the beginning I really didn't want to work. But
I just had to do it because my family is poor. Now,

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I got used to it so it's ok. But if I have a chance, I
would prefer to change jobs.
Question:Why did you think you had to do it? Did you feel
responsible?
Huyen:
Yes, especially to my mother. My mother always
worked very hard in the house and in the field. She
was working all the time.
Question:
How about your father?
Huyen:
I don't feel responsible for my father. He spends a
lot of the money I earn on alcohol and I am reallyunhappy about it.
At the core, Huyen had strong feelings of love for her mother,
who for her is the most important person in her life. Having worked withher from early childhood, Huyen firmly believed that she should help
and support her mother. Huyen's love for her mother inspired deep
abhorrence to her father. He had been very strict, particularly towards
her, she felt, not allowing her to play with her friends and sometimes
going as far as beating her. For Huyen, leaving home to work on thestreets was a way to share her mother's economic hardships.
The same as Huyen, a 14-year-old boy, Minh, emphasized his
compassionate feelings towards his hardworking father, who was also his
only blood relative:"It's for my father that I work. My stepmother cannot work
because she is mentally unstable. My grandmother is too old to work. My
father works very hard for the family and I want to support him."
As a child born in a poor family, these Vietnamese children areraised as productive members of the family from an early age. However,the degree to which they feel responsible and the burden they eventually
decide to take on their shoulders varies. While some children felt that
supporting their family was a duty to which circumstances obliged themto submit, others saw it more as a voluntary act of love. Dong (16)stressed that he feels responsible as the eldest son to help his parents andpay for his brother's school fees.

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During the many conversations we had, Dong once mentionedthat he shouldered a heavy burden to support his family. When we asked
him what he wishes to change in his life, he immediately replied, "I want
my family to have better living conditions so that I don't need to worry
about their economic situation anymore." Other children who have older
siblings like Nguyet tended to feel less responsible. Nguyet seldom feltthat she had to work. She was aware of the importance of her earnings forthe family's livelihood, but underlined that it was rather on account of her
spontaneous wish to help. Although Nguyet usually makes more money
than her sister (22 years old) or brother (15 years old), when she cannot
sell enough postcards, her older siblings give her money to buy lunch.
Nevertheless, despite these varied feelings towards work, all of thechildren involved in this research gave most of the money they earned on
the streets to their parents.
We met only a few children in Hanoi claiming to like working
on the streets. Although admitting that it gives them freedom, all foundworking on the street very hard in many respects. No matter how severe
the weather is, they have to work every day under the hot sun in summer
or on cold days in winter. They are constantly harassed by the police; allof the children were afraid of the police. Some had experiences of getting
their goods or tools confiscated and a few had been arrested and sent toa reformatory for a few months.
When we asked whether they preferred to stay at home insteadof working on the streets, we got different reactions. Loan and Huyen
preferred to stay at home and do the household chores. All the others
preferred working on the streets. As Dong said, "there is nothing to do athome;" material scarcity of home was a commonly shared view. Further,
the lower values attached to non-productive household work made thehome less attractive than the streets. For Nguyet, it was not only that she
did not like doing cooking and cleaning, but also because of the higher
values attached to the street as a place to generate income. Working on
the streets, she wished other people (her migrant neighbors from thesame commune) to understand the difficulties of her family. For Xuan, it

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was also to escape from her older sister who, due to a mental illness,often beats her. And for Minh, it was because he felt more comfortablebeing with his friends on the street.
In sum, this section has dealt with distinctions between poor andwealthy children in terms of the type of childhood that they experience.
Wealthy children in Vietnam experience a nurtured childhood similar tothat of children in wealthy countries, their main "work" being first andforemost to be a good learner. Being protected by parents, innocent nurtured
children are allowed to entertain themselves and dream of a bright future.
Poor children, on the other hand, far from being nurtured, nurture theirhouseholds. Heavily depending on their parents, nurtured children are
consumers, whereas nurturing children are productive workers whosemonetary resources are indispensable for their families' survival. Poor
children play a crucial role in the maintenance of the family and shoulder,consciously or unconsciously, a substantial burden of responsibility.
What makes them keep going? Do poor children force themselves to be
nurturing? If so, why and how do they manage or struggle? Do they try
to find a way out? In the following section, we will consider these questions
by looking at the tensions that inform the lives of children who work on
the streets.

5. Tensions in the Lives of Nurturing ChildrenChildren working on the streets experience, as opposed to
wealthy Vietnamese children, a nurturing childhood rather than a nurtured
childhood. As argued, to be nurturing entails self-sacrifice, such as
dropping out school to work, and devoting oneself to supporting the family.
The children we interviewed accepted their roles as sons and daughtersfrom poor families. Here we argue that, although they would prefer to be
nurtured children, they are aware that this is not their fate in life. So they
eventually accept the burden that familial solidarity puts on their shoulders.
We substantiate this statement by first describing two main tensions thatchildren face, namely, governmental policies, and poverty and parental

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expectations. We then illustrate how they attempt to deal with these tensions in daily life.
5.1. Government Policies
Children are highly concerned with the presence of the police
while working on the streets. Many wished to change jobs due to theintense police patrolling that hindered them in carrying out their illegal
work. In Hanoi, particularly in tourist areas, one sees a considerable
police force. In the eyes of local authorities, street working children are
a disturbance that threatens the safety of foreign tourists as well as of thelocal public. Before Doi moi, there seem to have been fewer street workers.
Until recent years, urban administrators mostly ignored "the street children
problem" and it was not considered to be a serious social problem(Phung, 1996). It was after the reform towards a liberalized market economy
that the presence of street working children became more apparent in theeyes of the government as well as society. Simply rounding up children
using police forces and putting them in an institution was believed to bea means to settle the "social phenomenon" of street children. Yet, there
were signs of growing numbers of children working on the urban streets.
It was with ratification of the CRC and the arrival of foreign
non-governmental organizations (NGOs) that from the early 1990s theVietnamese government's attitude towards children on the streets graduallychanged. As Bond puts it, in the mid-1990s, "it suddenly became important[for the local authorities] to protect street children from the 'social evils'
that surrounded them in their day to day life, the surest way being forthem to return home permanently" (2003: 14). This assumption is basedon the CRC provision that children's healthy development should takeplace at home. As opposed to the home, the streets are primarily viewed
as a risky place, in which social evils (te nan xa hoi), such as crime, drug
abuse, and prostitution, thrive and expose children to the loss of a proper
childhood (Nieuwenhuys, 2003). Being defined as Children in Need ofSpecial Protection by local authorities, street children are beneficiaries of109

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numerous NGO projects.7 However, listening to children has made usaware that the current approach reflects a lack of consideration of thediversity of their experiences. Neglecting the diverse contexts in which
they live, local authorities see in them little else than a social problem inneed of cure (Hecht, 1998). The treatment given to cure the problem is
primarily geared towards prevention, protection, and reintegration bybuilding a firm bridge between children and home. In Hanoi, implementationof this policy is typically done by the police. Police patrols constantly
inspect the main tourist areas, such as Hoan Kiem district, and it is at ahigher state of alert when major events take place in the city.8
Doi moi's attempt at generating money through global markets,
such as tourism, international events, and other business activities, hasbeen important for Vietnam's economic development. In order to maintainthe level of economic growth, Vietnam has pursued a set of policies for
integration in the global economy. These policies have been accompanied
by de facto privatization of welfare, education, and health services.
Rescuing Children in Need of Special Protection, whose childhoods are
at risk, is not the primary concern of the government; the government's
intention is rather to hide street children away by sending them back totheir homes. This policy has been reinforced since 2003, when a big
sports event, SEAGames23, was held in Hanoi. The event involved
ASEAN member countries. Believing that street working children would
generate negative images of Hanoi among visitors, the government started

7 Officially, all the street children projects in Vietnam require permission from the government tobe implemented. Most international organizations are thus obliged to implement projects in cooperation with the local committee, namely, the Commission for Population, Family and Children.
In the name of local ownership, the government strictly regulates what should be and should not
be done for children on the streets.
8 During our fieldwork, there were three major events in Hanoi, including celebration day for Ho
Chi Minh's Declaration of Vietnam's Independence on August 19; the National Independence Day
on September 2; and Hanoi's liberation day on October 10. Local authorities began preparing foreach event one month to a few weeks prior the actual date of the event, which required a considerable number of police on the streets. On almost every corner of the main districts, the presenceof police, army, as well as local committee members was observed. In addition, during the wholemonth of October, there was a traffic/road safety campaign, which required the presence of policeon the major streets.

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the children up from the streets. Under the cover of protecting them fromthe exploitative streets, the police arrested the children and sent themfirst to a social protection center for a period from two weeks to threemonths, and eventually back to their home villages. Evacuating street
children in this way was praised as a "success" and the policy is still
pursued.
A tourist visiting Hanoi for a short period of time may think that
there are no street children, and this is also what we felt in the beginningof the fieldwork. Many locals we talked to said there were scarcely any
children working on the streets. But we soon realized that this was nottrue. It was not that children were no longer on the streets to work, butrather, they became highly skilled in making themselves invisible. For
example, 13-year-old girl Nguyet always kept her postcards and books ina colored plastic bag to pretend she was merely a girl wandering aroundthe lake instead of a street vendor. While working on the street, what she
was most afraid of, as she mentioned, was the presence of the police.
Some children have experiences of being arrested by the police
and sent to a re-education center for a few months to live and work withother children. Loan (10) was one of them. She stayed in Ba Vi, where
she had to do housework like cleaning and washing. She claimed that"they shouldn't have arrested me because I have to work to earn money!"
Many children also consider changing their work due to the anxiety of
being arrested, a decision precipitated, as we will see, by the consequences
they mat face if caught. Dong, who quit shoe shining after a few interviews
and is now working for a restaurant (as a motorbike keeper), told us that
he was relieved, since he no longer needed to pay attention not avoiding
the police.
Far from protecting poor children, government policies have inpractice the opposite effect. To some extent, the official guidelines fail tohelp children return home, and even threaten their work opportunities
and thus increase their vulnerabilities. This effect is strongly linked to
Doi moi open door policies and the transformation of the social protection
system it entailed.

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5.2. Poverty and Parental Expectations
As remarked in the previous section, children are well aware of
their position as daughters and sons of poor families. They accept theirroles as income generators by understanding that working is essential forthe livelihood of their families. This does not mean, however, that they
all are satisfied with their current work. Even if children bring most of
their earnings home, a number of them admit that they would like to keep
more money for themselves. Generally, parents allow their children to
keep a small sum of money to buy snacks, drinks, food, and sometimes
accessories or clothing. Although their parents do not set a strict amountthat the children should earn, the children know exactly how muchmoney their parents expect them to bring home. When the children
cannot bring enough money home, their parents react in different ways.
Some conceal their disappointment, while others, such as Loan's motheror Minh's father, express their dissatisfaction and resentment. Of course,such parental attitudes reinforce children's feelings of failure to fulfill
their parents' expectations. Minh struggles to live up to what his father
expects from his only son. Noting that he felt more comfortable withshoe shining friends on the streets than with his parents:"I feel that I'm less loved by my parents than other children are.
I feel sad… because my father shouts at me. Whenever I bring a small
amount of money, he shouts at me and says that I should work harder andearn more. I wish I could go back to non making. That job was notdifficult and I liked it much more than shoe shining… But I cannot say
it to my father, because I know that with non making, I cannot earnenough for my family."
Despite the fact that he desires to keep more money for himself,
Minh cannot disappoint his father's expectation that his son should
behave as the good child of poor parents and support the family. Even if
he does share his family's hardships, Minh is not happy at home.
As a sole income earner in the family, the economic burden
bears considerably on Dong's and Huyen's shoulders. They both voice112

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serious concern about the financial difficulties of their families, whose
survival is largely in their hands. Dong hoped that his family would
improve its financial situation so that he could be released from theanxiety arising from poverty at home. Yet he emphasizes his responsibility
to support his family. Huyen repeatedly claimed that her work—fried
donut selling—no longer brings enough money. Once we asked her what
she would wish if anything was possible. As if working to support her
family was an ever-lasting duty, she answered, "I just want a more stablejob." In one of the last conversations we had with Huyen, she said that
she thought of nothing else than the amount of money her mother would
need for the livelihood of the family. The cases of Dong and Huyen
reveal dramatically how the feeling of responsibility for the family leaves
no room for them to keep some money to spend on themselves.
We suggested earlier that the local interpretations of what an
ideal childhood is about may differ according to social class. In explaining
the meaning of "dao duc" (moral) and "tinh cam" (sentiment), which for
Rydstrom are crucial aspects of children's moral upbringing, Nguyet
reflected that:"Dao duc means to help others. For example, if you are rich,
you should not look down upon the poor. You have to respect others. Tinh
cam means that for instance when I am sad or happy, I tell others about
it. Then I can share both sad and good things with other people. Because
in this way they can show me sympathy. I want to get more tinh cam, it
makes me happy. I have to be good to get more tinh cam. I have to learn
well and work hard. I mean both studying (at school) and working (onthe streets to contribute to the family). I am trying my best to get moretinh cam."
We many times witnessed Nguyet rubbing the sleep out of her
red eyes while trying to sell more postcards. She would not stop sellingas long as there were tourists in the streets. As we gradually got to know
Nguyet, we also came to understand how difficult she finds it to be a"good child." She has managed to work hard both at school and on thestreets since she was only nine years old. She is the best student in math,113

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and does not go to bed before finishing her homework. Now, she is in thelast year of her primary school and craves to continue her studies. But as
the secondary school supported by the NGO is too far to reach for a small
girl like her, she also knows that it would not be possible to continue
schooling without a bicycle—something her mother cannot afford. She
knew that a good learner could eventually attain through schooling much
more for herself and her family than by following the already paved waysof the urban street workers. On the other hand, she also knew that her
monetary contribution to the household had become indispensable tosustain the family. She continues to work on the streets, with a tiny hope
to realize her only wish.
For most of the children we interviewed, poverty is a primalcause of hardships in their lives. A number of them claim that if only theirfamilies had more financial resources, they would have been happier thanthey are now. For instance, Loan described her feelings about working on
the streets: "I feel miserable working on the street. Why do rich people
have so many different motorbikes while I don't even have a bicycle?"
Working on the crowded lively streets, in which rich tourists gather tovisit shops and cafÐs, leaves her with disconsolate feeling. The children
who experience poverty at home rarely dream to be rich when theygrow up. Whether they believe such a dream is merely fantasy or holdantagonistic feelings towards the rich, poor children wish to have little
more than just enough to keep going.
Poverty causes tensions between being an ideal child in linewith parental expectations and the desire to be released from economic
burden. As their moral duties enjoin them to share the hardships of thefamily, poor children live in constant tension. As we now turn to discuss,poor children deal with these tensions by attempting to accept the gulf
separating their world from that of wealthy children.
The children we interviewed sometimes compared themselveswith other children who go to school and need not work for money. They
tend to separate, consciously or unconsciously, the world of the rich fromthat of the poor. As if they come from another social world, they draw a

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Between Nurturing and Nurtured Childhood: Children Working in the Streets in Hanoi

distinction between the haves and the have-nots. From the latter
perspective the childhood of the former is happier, because they can be
full time students and have no other responsibilities. Experiences athome, at school and on the streets, create a range of tensions—stress,
frictions, and even hostility—against children of the haves.
The children may harbor hostile feelings towards non-working
children who spend their time mostly in school, as the following
conversation with Xuan, as a child who combines work with school,
illustrates.
Xuan:
I like going to school because my teacher is very
nice. She is a new teacher in my school and she
has been very kind to me. And she always tells methat the school is a happy place for children!
Question:
How about your friends at school?
Xuan:
My classmates tease me because I sell chewing
gum on the street. They call me a "chewing gum
seller" and make fun of me. I hate them. But I
want to be like them so that I can tease them back.
Though Loan went to a different school,9 she too experienced
bullying at school. Although her mother was planning to send Loan to a
new school, Loan did not seem to be enthusiastic due to her dismal
memories with school peers. Nonetheless, according to Nguyet who had
similar experiences but overcame them, bullying rarely occurs aschildren grow older because "we poor students in the final grade have to
be good examples for younger students, so we behave well at school."
But in small Loan's class, there were only a few working children, andthat is why she was bullied.

9 At the time of our fieldwork, Loan was in the process of transferring to another school from thesame charity school as Nguyet's, which for Loan was too far reach on foot, so she could attend
often enough. Unlike wealthy children, none of her family members had spare time nor means,such as a bicycle, to send her to school. According to her physical age, she ought to be in the third
grade; yet, she has to start from the first grade in a new school, which may be another source ofbullying by other pupils.

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When we asked Nguyet what she thought about her friends who
do not work, she replied:"I think they have more time to play. Sometimes when I am
bored of working, I wish I could play freely like them. But I do not envy
them because my family is in difficulties and I have to accept that I needto help my family."
Persuading herself to accept the situation in which she wasborn, however, is not as straightforward as she would hope. Nguyet
continues, looking back how she has lived through the experiences of herchildhood:"When I was smaller like Xuan or Loan's age, I think I was
happy enough. I had to work every day selling chewing gum and sweets
but I felt happy. Now because of the hardships that my family faces, I do
not feel as happy as before. I think non-working children are happier. To
be happy, I need more money and also need to learn better at school. I
want to be happy like others. So I will continue this work (selling
postcards and books) for a few more years, and then when I get my
identity card,10 I want to find a more stable job. Maybe in a souvenir
shop…"All the children saw themselves as less happy than non-working
children who are looked after better by their parents and have more time
for play and study. Even within the same family there can be differences.
Huyen said, "I think my sister and my brother are much happier than me
because they just go to school and need not work hard like me." When
we continued to ask Huyen about her relationships with her siblings, sheshowed feelings of love for her brother, but not for her sister. Later when
we visited her family 70 kilometers south of Hanoi, we found out that,
thanks to support she began to receive from French foster parents living
in Paris at the age 13—the same age at which Huyen started working on

10 In Vietnam, when a child reaches the age of 18, s/he receives an identity card from the authorities. It is generally said by children that if they have an ID card, it allows them to engage in amore stable job.

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Between Nurturing and Nurtured Childhood: Children Working in the Streets in Hanoi

the streets—her sister, Mai, could go to school. Her parents explainedthat Mai's education was ensured till she completed upper secondary
school. We soon sensed why Huyen did not like her sister. It was not, as
far as we understood, because she hated her sister as a person. Rather,she found it difficult to accept the fact that, by sheer luck, her sister had
obtained what Huyen had lost in order to share in the family's hardships.
Strikingly, however, Huyen denied being envious of her sibling.
As discussed earlier, the children wished to pursue education and strongly
desired to be released from the burden they shouldered. Why would they
not be envious if they thought other children happier? The reason may besought in how the society oppresses poor children and prevents themfrom having dreams that are seen as unrealistic and unattainable. Among
those who feel inferior, Confucianism feeds a sense of self-denial anddivides society. As they become aware of their social position, the childrenof the poor understand and internalize that only the rich are entitled to or
deserve to demand what they wish:
Question:
What do you think of those children who go toschool?
Huyen:
I feel sad (because I cannot go to school). But I
don't envy them.
Question:Why?
Huyen:
Because I'm not permitted to envy others.
Question:Why do you feel that?
Huyen:
They can go to school and I cannot. It is just afact, so there is no reason for me to be envious of
those who can.
Question:
But why do you think you are not permitted toenvy?
Huyen:
Because if I stay envious with others, I'll make myparents sad… To be honest, I envy those who can
go to school, but I cannot say it loudly. I keepthese feelings to myself. I don't want to tell others
about it.

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When the children were asked whether they wished to go backto school, those who had to drop out of school to help the family showed
mixed feelings. They tended to feel that it was too late or too embarrassing
to start from the lower grades from which they had dropped out and sit
with younger pupils in the class. Dong felt regret for leaving school asmost of his friends are still in school. Likewise, Minh also regretted
dropping out. Nonetheless, he never tells his father about it, because heknows that if he goes back to school, he could no longer help the family.
In sum, children make a significant distinction between theworld of the poor and the world of the rich. Seeing their world from theperspective of the latter leads them to devalue what they do. Powerfulsocio-cultural structures oppress poor children and lead them to behave
according to social expectations. Re-invented Confucianism works as a"higher moral goal" that helps poor children to come to terms. Partially,
they do not internalize this higher moral goal, as they do not resent thatthe richer children can consume and play, but would prefer to be likethem. They are, however, aware that this is not their fate in life, so they
eventually submit to their roles to be nurturing. By broadly looking at thetwo tensions that inform street working children's lives and how theyattempt to deal with them, we have shown that they are individual social
beings who struggle but seek to make sense of their lives and negotiate
the value of what they do. In a society in which the importance of market
expansion grossly outweighs the protection of the weak, government
policies to "save" them are ineffective. These policies not only fail to support
children working on the streets, but rather hamper their search for livelihood.
Far from being nurtured, the children of the poor feel responsible for thewell-being of their families. As if there were no other options than toaccept reality, the children persuade themselves to share in the hardshipsof the family, regardless of their own wishes to pursue education andplay. Even if they do not oppose their parents, their lives are enmeshedwith tensions between what is expected from a "good child" and their
desires, kept at a deeper level, to be like nurtured children.

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Between Nurturing and Nurtured Childhood: Children Working in the Streets in Hanoi

6. Concluding Remarks
Poor children working on the street may seem, at first sight, asa group of undifferentiated children who can be legitimately labelled"street children." However, as we have contended, each child has adifferent reason for being on the street, and different ways of viewing
why s/he is using the urban spaces for work. In other words, the category"street children" is wrongly equated with a social phenomenon.
Sociologically, the children labelled as such are a part of a far larger
group of nurturing children of whom only a small part happens to workon the streets. The term "street children" actually reflects that for policy
makers what causes concern is not the hardships that these children face,
but their very presence and visibility on the city streets.
The analysis in this paper has attempted to show why childhood
is not unchanging or universal, but a social process made by children,
both those that are nurturing and those that are nurtured. Children aresocial beings who have agency to come to terms with tensions andnegotiate the values of their childhood. Children of the rich and the poor
in Vietnam experience different practices of childhood and are expected
to do so by their parents and society at large. Many children of the poor
described their childhood as less happy than those who do not need towork and said that they shoulder a heavy economic burden to nurture
their families from an early age. They face numerous tensions in theireveryday life, but somehow find ways to appropriate and contest thegrowing gulf between nurtured and nurturing childhood.
Rather than providing a complete picture to understand thediversity of childhood, this paper on childhood sought to account for
dynamic socio-cultural constructions to a particular context of children
working on the streets in Hanoi. More specifically, it sought to explain
the childhood dichotomy in which only wealthy children are able tobecome closer to the now dominant Western model, while poor children
seem to be increasingly condemned to become nurturing. As shown, thetensions experienced by street working children between nurturing and119

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Aiko Takai

nurtured childhood is welded to a world in which the dichotomy between
the rich and the poor is widening.
Considering the small size of the sample and limited researchedperiod, we are aware that the findings of this research are of limited
scope. It is not intended to draw generalizations but to suggest directions
for further research. One of these is that because "street children" ismerely a label of a social phenomenon defined by the dominant perceptionof society, future research needs to take into account the wider context ofsocio-cultural background to which those labeled as "street children"
belong and how these notions are articulated in children's daily practices.
In depth studies of how these notions and children's own perceptions
interact would lead us to further understand the process at work in the
lives of working children on the streets.

References
Bond, T. 2003. A Study on Street Children in Hanoi and an Assessment of
UNICEF's Street Children's Project in Hanoi, Thanh Hoa, and Hung
Yen, Unpublished Report.
Boyden, J. 1990. "Childhood and the Policy makers: A Comparative
Perspective on the Globalization of Childhood." In A. James, and A.
Prout (eds.) Constructing and Reconstructing Childhood:Contemporary Issues in the Sociological Study of Childhood: 184215. London, New York, Philadelphia: The Falmer Press.
Burman, E. 1996. "Local, Global or Globalized? Child Development andInternational Child Rights Legislation," Childhood, 3: 45-66.
Gammeltoft, T.; and K. F. Olwig. 2005. To Make My Parents Happy:
Anthropological Perspectives on Children in Vietnam. Hanoi: The
Statistical Publishing House.
Hecht, T. 1998. At Home in the Street: Street Children of Northern Brazil.
Cambridge: Cambridge University Press.

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Hojer, B.; E. Johansson; T. V. A. Nguyen; and B. Rubenson. 2004. "Child
Domestic Servants in Hanoi: Who Are They and How Do They Fare,"
The International Journal of Children's Rights, 11: 391-407.
James, A.; and A. Prout. 1990. "A New Paradigm for the Sociology ofChildhood? Provenance, Promise and Problems." In A. James, and A.
Prout (eds.) Constructing and Reconstructing Childhood:Contemporary Issues in the Sociological Study of Childhood: 7-34.
London, New York, Philadelphia: The Falmer Press.
Nieuwenhuys, O. 1998. "Global Childhood and the Politics of Contempt,"
Alternatives, 23, 3: 267-290.
_______. 2003. "Places of Children and the Non-place of Childhood in
Poomkara." In K. Fog Olwig, and E. Gullöv (eds.) Children's Places,
Cross-cultural Perspectives: 99-119. London: Routledge.
Pare, M. 2003. "Why Have Street Children Disappeared? The Role ofInternational Human Rights Law in Protecting Vulnerable Groups,"
The International Journal of Children's Rights, 11: 1-32
Phung, T. H. 1996. "Tim hieu ve tre em duong pho o Hanoi qua mot cuoc
khao sat" (Street Children in Hanoi: A Glance from a Survey). In:
Trinh Duy Luan (ed.) Tim Hieu Mon Xa Hoc Do Thi (Understanding
Urban Sociology): 1-29. Hanoi: Nha Xuat Ban Khoa Hoc Xa Hoi.
Punch, S. 2000. "Children's Strategies for Creating Play Spaces:
Negotiating Independence in Rural Bolivia." In S. L. Holloway, andG. Valentine (eds.) Children's Geographies: Playing, Living,
Learning: 48-62. London and New York: Routledge.
Rubenson, B. 2005. Working Children's Experiences and Their Right toHealth and Well-Being. Stockholm: Karolinska University Press.
Rydstrom, H. 2001. "'Like a White Piece of Paper' Embodiment and theMoral Upbringing of Vietnamese Children," Ethnos, 66, 3: 394-413.
_______. 2002. "Sexed Bodies, Gendered Bodies: Children and the Body
in Vietnam," Women's Studies International Forum, 25, 3: 359-372.
_______. 2003. Embodying Morality Growing Up in Rural Northern
Vietnam. Honolulu: University of Hawai'i Press.

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Stephens, S. 1995. "Children and the Politics of Culture in 'Late
Capitalism.'" In S. Stephens (ed.) Children and the Politics of Culture:
3-48. New Jersey: Princeton University Press.
UNICEF (United Nations Children's Fund). 2005. "Childhood under Threat:
The State of the World's Children 20d05." Retrieved on January 29, 2007
from http://www.unicef.org/sowc05/english/childhooddefined.html.

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Chapter 5
Social Protection for Internal Migrants
in Vietnam
Pham Quynh Huong

Abstract
This paper uses a SWOT analysis to evaluate the strengths, weaknesses,
opportunities, and threats for internal migrants in Vietnam regarding
their accessibility to the social protection system. It is shown that
migrants are facing various social and economic difficulties in urban
areas due to their own characteristics and to constraints in urban management. Low levels of professional skills, weak social networks, andsaving-induced behaviors are limiting migrants in seeking good jobs,
which in turn leads them to live in hazardous conditions. At
the same time, current regulations and limited capacity in urban
management, including resident registration requirements and obsolete
views on migrants, are sources of difficulties for migrants to access social
protection services. Given these circumstances, the paper suggests somepolicy measures to improve migrants' accessibility to the social protection
system.

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Pham Quynh Huong

1. Introduction
Internal migration, including rural-urban migration, has
increased in Vietnam since Doi moi. Internal migrants (hereafter
migrants), as part of the urban labor force, have their own strengths to get
opportunities and gain benefits from the urban areas in which they settle.
However, various constraints during the migration process restrict themfrom meeting the demands of the labor market. Migrants also have todeal with a number of daily-life difficulties and challenges, which
require their substantial efforts to overcome. These impediments may inturn reduce the advantages brought from migration. Economic gain
through increased income is the main purpose of migration. In addition,
migrants hope to attain better living standards in terms of education andspiritual life.
This paper analyzes the current state of internal migration in
Vietnam and suggests some policy directions for providing social protection
services to migrants. It is organized as follows. Section 2 presents a
SWOT analysis—an evaluation of strengths, weaknesses, opportunities,
and threats—on the need among migrants for social protection. The
current state of migrants' access to the social protection system is
described in Section 3. In Section 4, I suggest some policy directions that
could improve accessibility for migrants in the social protection services.
The last section reviews the main points of the paper and urges public
administrators to take appropriate policies to guarantee social protectionaccess for migrants, thus enabling their migration to be a beneficial force
for development.

2. Migrants' Need for Social Protection: A SWOT
Analysis2.1. Strengths (S): Migration as a Life Strategy of Rural Households
Migration to urban areas is a common choice among rural
people because migration is hoped to increase income for the migrants

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Social Protection for Internal Migrants in Vietnam

themselves and for their households. Many migrants are young andsingle, which are advantages in the job market. Another advantage many
have is diligence and willingness to do the jobs that urban people do notwant to do, even with very low wages (Le et al., 2005; and Dang, 2005).
One important characteristic of migration is that it can help
promote hunger eradication and poverty alleviation for the people who
remain in rural areas. Migrants' remittances can be a significant sourceof income for rural households. Migrants to urban areas commonly work
hard and live austerely to reduce their living costs in order to earn andsave more money to send to their families in rural areas. The remittances
they send home are usually used for living costs, educational and healthcosts for children, and payment of debts. Remittances are also crucial inensuring food security because migrants' families are able to avoid
selling their livestock to buy food. The livestock thus remains with thefamilies as an important resource for coping with unexpected risks.
Remittances also help the migrants' households to invest more inboth farm and non-farm production. Through remittances, migrants arecontributing to hunger eradication and poverty alleviation in rural areas,at least for the places they left (World Bank, 2004; ActionAid, 2005; andLe et al., 2005).
Migration is also a channel to disseminate information thathelps to develop the rural areas. By taking part in the urban labor market,
migrant workers become the linkage to disseminate new information,knowledge, and lifestyles from urban to rural areas (Le et al., 2005).
Furthermore, temporary migrants, who later will return to theirhometowns, also contribute to transferring skills—an important factor
for rural development.
Although migration becomes a life strategy for many ruralfamilies, not all of them have equal opportunities for migration.
Migration is a complicated process and decision, as it requires conditions
such as financial capacity, a certain level of educational attainment, good
health, and good social networks. Migration is not an easy decision forrural families, especially for the poor (Dang, 2005).

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Pham Quynh Huong

Social networks act as an important informal support source for
migrants. These networks, composed of people from the same hometowns,
friends, and relatives, create a crucial resource not only for money orassets, but also for necessary information, knowledge, experience, andother timely supports (either physical or moral). Social networks
help migrants reduce both economic and psychological costs during
migration, as well as increase opportunities for success (see, for instance,
ActionAid, 2005; Le et al., 2005; Dang, 1998a, 2005; and Nguyen et al.,2005b). In societies where the formal social protection system isunderdeveloped, such social networks become more important in supporting
migrants.
2.2. Weaknesses (W): Human Resource Policies
Developing countries, particularly in their rural areas, usually
have abundant unskilled human resources, and limited technical andvocational training programs. Vietnam is facing this situation.
The average educational level and professional skills of
migrants are lower than those of urban people. Migrants to find goodjobs, and thus better income, if they have good education and skills(ActionAid, 2005). Internal migrants in Vietnam can be divided into two
types in terms of education and skills. Migrants with relatively higheducational attainment and professional skills, even higher than those ofurban people, will be able to find good jobs in the formal sector.
Moreover, they also usually have high income, good quality of living,and stable residences, and hence they can obtain the long-term residential
certificates, namely KT31 (Nguyen et al., 2005a). Migrants with lower
educational level and professional skills face many difficulties inseeking jobs in urban areas. They usually have to accept temporary jobs
with low wages in the informal sector. Also, they tend to have weak

1 KT resident registration regulation is called "ho khau," in which KT1 is applied for those who areliving at same place where they registered; KT2 is for those who registered in a district, but arestaying in another district; KT3 is for migrants who registered for a long-term stay; and KT4 is
for migrants who registered for only a short-term stay.

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Social Protection for Internal Migrants in Vietnam

social networks, and thus always struggle for low-paid jobs in urban
areas. In fact, many of these migrants return to their hometowns after acertain time spent seeking a job or working in urban areas.
Another serious problem is that migrants have limited informationand knowledge in seeking jobs. The majority of migrants get jobs byintroductions from their relatives or friends. Migrant laborers are limited
particularly in terms of information about their rights and accessibility tourban services, as well as wages, types of jobs, and skill requirements(ActionAid, 2005).
Since their main purpose of migration is to earn and savemoney, migrants have to work hard, and thus they have no time to relax.
After working, migrants spend most of the remaining time sleeping or
doing personal activities, rather than seeking entertainment. As such,they have no time to look for the essential services for their living.
Moreover, to save as much as possible, many migrants do not have TV,
radio, or newspapers, and such living conditions in turn further impede
them from getting information. Lacking appropriate information makes
it difficult for migrants to seek jobs and negotiate wages and other working
conditions in the labor contracts.
2.3. Opportunities (O): Rapid Industrialization and Urbanization
Under rapid industrialization and urbanization, laborers in bothurban and rural areas have vast opportunities. These processes havecreated more jobs and income opportunities, which in turn encourage rural
people to migrate to urban areas, though they must deal with anumber of difficulties (Dang, 2005).
Industrialization and urbanization also bring a great deal ofknowledge, skills, and information through activities in which migrants
become involved. Further, urbanization also provides good opportunities
for education and occupation to migrants' children. This explains theincreasing number of migrant households that are currently staying andworking in urban areas: they hope to seek a better future for theirchildren.

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Pham Quynh Huong

2.4. Threats (T): Residential Registration System
Migrants usually work in hard conditions. Moreover, theirliving standards suffer because of their efforts to save money though
reducing living costs. Due to low wages and unstable income sources,
their lives become more difficult as living costs are raising in urban
areas. Therefore, migrant workers usually live in rented houses or lodgings,
which are narrow and dirty without basic facilities (such as toilet,
electricity, and clean water), and, in particular, are characterized by poor
hygiene and low security conditions. They face a variety of dangers, suchas stealing, communicable diseases, abuse, and violence. As a result,many migrants find their health worse than before (ActionAid, 2005;
Dang, 2005; Le et al., 2005; and Nguyen et al., 2005b). Under these
conditions, migrants desperately need a social protection system to coverthem.
However, the current regulations make it very difficult for themto participate in the formal social protection system. There are two main
reasons for this difficulty. First, migrants often change their residence toseek new jobs due to high competition for employment in urban areas,
and thus many of them have no permanent resident status. Second, thecurrent social protection system requires migrants to have a Resident
Registration Book, which is used as a tool to determine social services,such as health care, education, bank loans, land ownership, and businessregistration. Therefore, migrants who lack formal residential status havemuch lower accessibility to the social services than urban citizens.
As persons without formal residential registration in urban
areas, migrants are restricted in seeking a job in the formal sector,
attending vocational training, or have to work in poor conditions. And assuch, they are disadvantaged in acquiring labor rights. Migrants are
obstructed from or have limited access to public services. They usually
have to pay higher costs, even for poor quality services, for healthservice, tuition fee reduction and exemption, utility services, bank loans,credit, business, and urgent aid. They have little access to land, houseownership, registration of purchasing or selling assets (houses or128

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Social Protection for Internal Migrants in Vietnam

vehicles), or birth and death registration. They are also separated
completely from urban social life, and this makes them lack information,knowledge of their rights, and access to support from the local communities
where they are living and working (Trinh, 2004; World Bank, 2004,
2005; and Bui, 2005).
A study by the World Bank (2005) indicates that migrants
become poorer than their counterparts in urban areas due to worse living
conditions, including the lack of provision of social services. This meansthat residential registration, rather than other than socio-economic
conditions, has severely affected the level and quality of social services
for migrants.
In addition to various difficulties in daily life, lack of access tosocial services has made migrants be abused and exploited (World Bank,
2005; Le et al., 2005). Migrants get less access to social services thanurban citizens, and accordingly they become victims of corruption. They
have to lean on "outsiders" or "brokers" at triple the rates paid by theirurban counterparts to get the services of a public notary. Most migrants
have to seek support from a "broker" when registering short-term
residence (World Bank, 2005). Aside from obstructing migrants from
improving their living standards, the abuse of residential registration
procedures is a reason for bribery and corruption (Nguyen et al., 2005b).
Due to their lack of access to social services, many migrants areliving in vulnerable conditions, which result in them joining the ranks ofthe poor people in urban areas, or even becoming poorer than they were
before migration. In Ho Chi Minh City, about one-third to two-thirds ofthe population in the poor areas are migrants who hold temporary
residential registration, or even hold no residential documents(ActionAid, 2005; Le et al., 2005; and Dang, 2005). If there are no
appropriate policy measures for such situations, there will be huge flows
of migrants from rural to urban areas, and they will create poor areas in
the cities. This is a difficult policy issue not only in terms of hunger
eradication and poverty alleviation strategies, but also for urban
management.

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3. Doi moi and the Current State of Social Protection
for Migrants
3.1. Migrants and Accessibility to Urban Social Services
Urban areas in Vietnam are currently overloaded. Many studies
argue that one of the reasons for this situation is an increasing number of
migrants. While Doi moi has brought many changes in living standards
for the urban citizens, it might not bring the same things to rural people,
particularly migrants.
Education: The so-called "overloaded schools" phenomenon
actually happens only in high quality and well-known schools, even if
these schools are "out-of-state" ("trai tuyen") for those who attend them.2
The main goal of migrants is economic gain, and therefore they will
work instead of going to school when they reach the working age. In thecase that all of the family members migrate together (though this is not
a common practice), the children will go to school. In order to reduce
living costs, migrants often live in the areas where infrastructure is poor,and primary schools have low quality and conditions. Moreover, most ofthese children go to private schools rather than public ones. Similarly, it
is also difficult for migrants' children to go to junior and senior highschools in urban areas due to high costs and requirements of formal
residential registration, which they usually cannot afford. Without formal
residential registration, migrants must pay very high costs to get theirchildren into schools.
Under the current capacity of educational services in urban
areas and the high demand for education, it is true that migrants are making
considerable pressures on educational system. However, there is anextreme difficulty for migrants' children to have better education, as they
do not receive the same treatment given to their counterparts in urban areas.
2 Resident registration is a basis for the rights to access of social services, including education.
Children who are not going to the schools in their place of residence are considered "out-of-state"pupils.

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Health care: Many studies argue that migration may also create
significant pressures on the public health care system in urban areas.
However, this is not really the case in Vietnam due to three main reasons.
First, because the goal of migration is economic gain, rural people only
migrate to urban areas when they are healthy enough for hard work. Ifthey get sick and cannot work, they must return home to reduce thepossible costs of medical examinations and cures. Second, and similarly,
migrants are often young and healthy, and thus they seldom get sick.
Third, since health insurance is more common in urban areas than inrural areas, most of the migrants do not have any health insurance card.
As a result, without formal residential registration and health insurance
card, they must pay a lot of money to get health care services. Many
surveys show that migrants seldom go to see doctors because they try to
avoid medical costs, and they often buy medicines and treat themselves.
If they must go to check their health status, migrants often use private,rather than public, health care institutions near their place of residence.
Therefore, it is difficult to conclude that the presence of
migrants is making a heavy burden on heath care services in urban areas(Dang, 2005). However, this situation also indicates a great disadvantageof migrants in accessing health care services in urban areas. These
services are necessary for them to maintain good health under their hardworking conditions.
Housing: As mentioned earlier, migrants often reside in areas
with poor infrastructure in order to reduce living costs. They usually rent
temporary houses with bad conditions, where urban people do not wantto live (ActionAid, 2005; Dang, 2005; and Le et al., 2005). Somemigrants with good economic conditions (who usually belong to the KT3
residential category) can purchase or build houses, but they have to pay
many extra costs for making transactions or getting construction
permission by using other people's names, as they do not have formal
residential registration (Nguyen et al., 2005b).
In terms of urban management, housing demand of migrants
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demand. However, the current situation shows that housing demand from
migrants is not significant because only a few of them can afford to buy
or build houses in urban areas.
Employment and vocational training: Migrants are making agreat contribution to many economic sectors, such as manufacturing,
construction, and service. Most of them are working in the non-public
sector. Due to their low skills, migrants often face more difficulties inseeking jobs than do their urban counterparts. They are often employedin hard and hazardous work that urban people do not want to do (Le et al.,2005; and ActionAid, 2005). Few migrants who have good qualifications
and professional skills are able to get good jobs. There have been nostudies to compare the difficulties of urban laborers in seeking jobs withthose of migrants.
In terms of vocational training, migrants usually have tofend for themselves without any support from urban authorities andcommunities. In addition, migrants often go to vocational training
schools with low-level and short training courses in order to reduce
training costs and to be employed immediately. Thus, they usually havelower levels of training and skills than their urban counterparts.
Competition in vocational training among migrants is therefore negligible,
and such competition only exists in low-quality training schools.
The above-mentioned constraints are impeding migrants fromusing their advantages of youth, health, and diligence. Once these temporary
advantages disappear, migrants will incur more difficulties in seeking
jobs, and as such, the labor market in urban areas will be under hugepressure from unskilled labor. This in turn will create threats on social
protection system.
Loan, credit, and urgent assistance: Migrants have to provide
for all their own needs through their social networks. Since they haveno formal residential registration, they are generally excluded from theformal social protection system or social relief system in urban areas, inwhich loan, credit, and urgent assistance are very important. From theperspective of urban management, it can be said that migrants do not132

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Social Protection for Internal Migrants in Vietnam

make any pressure on these activities in urban areas. Under this situation,
migrants will face more difficulties if they do not have cohesive social
networks in the places where they are working or seeking jobs.
Infrastructure and environmental pollution: The current
situation of housing, environmental sanitation, urban security, and traffic
jams is commonly attributed to a huge flow of migrants. In fact, migrants
are living in very poor conditions in terms of electricity, clean water, andsanitation. They use electricity and water at the minimum level to reduce
living costs. In addition to such harsh conditions, migrants are facing
many difficulties in dealing with utility services, as they cannot sign any
contract to use these services without formal residential registration.
Therefore, to survive in urban areas, migrants must pay higher prices to
use these utility services, or they must use sources of low and unstable
quality, such as water from drilled wells.
While migrants may be one reason for the overloading demand
for these utility services in urban areas, this is not the main reason for the
shortages of these services in recent years, because urban citizens far
outnumber migrants. Without a strategic vision for the future developmentof urban areas, as well as expected flows of migrants, urban planning
authorities will face numerous problems in providing the necessary
utility services.
Social evils: As their migration is economically motivated,migrants often spend all their time and energy working to earn as muchas possible, and thus most of them have no free time. For most of them,after a hard day of work, sleeping is most important to their health(ActionAid, 2005; and Nguyen et al., 2005b). They have no time forentertainment, and try to avoid gambling or buying "luxurious" items tosave money. However, some migrants are heavily involved in social evils,
and this situation in turns makes difficulties for urban management.
Migrants frequently encounter a variety of social evils in theplaces where they live. Without accessing social services and receiving
support from local authorities, their daily lives become more risky, and133

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Pham Quynh Huongless beneficial than they expect. Under such circumstances, it is possiblethat they will be pushed into the low strata of society. This again resultsin various difficulties for urban management.
Participation in local community activities: Migrants confront
considerable constraints in integrating into their local communities.
Without formal residential registration, not only are they excluded fromformal social services and support, but they are also separated from many
local community activities that could help them overcome daily-life
difficulties. This situation even occurs among migrants who have been
living for a long time in urban areas. Discrimination against migrants by
local people is one source of the problem. Additionally, migrants tend tobe so unconfident and hesitant about their social positions that they do
not actively make networks with local people or participate in local
activities. Consequently, the majority of migrants do not receive frequent
support from the local communities, and they sometimes encounter
severe unexpected situations.
3.2. Right to Access Basic Social Services
Social protection has not covered migrants: Leaving rural
areas for urban areas can be regarded as one way for rural people to avoid
poverty. The need for reducing risk and ensuring life is motivation forthem to leave rural areas. Because the costs and risks of migration are
substantial, migrants desperately need a social protection system to help
them in dealing with the unstable and hard life in urban areas (Le et al.,2005). The current formal social protection system based on the formal
residential registration is clearly preventing migrants from accessing andbenefiting from social services and supporting programs. This system ismainly bringing benefits to urban people.
Formal residential registration system is a barrier for
migrants to access social protection system: The residential registration
system was started in 1950 with the original purposes of recording andcollecting demographic statistics, which served population estimates,134

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Social Protection for Internal Migrants in Vietnam

distribution, and migration. Under the centrally planned economy, theresidential registration system acquired some more functions.3
Under economic transformation to a market-oriented economy,
the functions of the residential registration system have also beenchanged: some functions have been deemed appropriate, while newfunctions have been established. In the current context, two functions
regarding migrants, i.e., distribution of socio-economic benefits andmigration control, need to be removed and replaced by economic andcivil institutions (Nguyen et al., 2005b).
An emerging question by both residents and authorities iswhether the simplified regulations on residential registration will affectmigrants on deciding to stay longer in urban areas. Migrants will decideto stay longer in urban areas once they are satisfied with two main
motives of migration: employability and increased income. Otherwise, if
migrants are not able to find a job, they will be temporary or "pendulum"
migrants. Results from surveys conducted in Hanoi and Ho Chi Minh
City show that about 50-60 percent of migrants want to stay in thesecities permanently, and they try to look for all possible ways to reach
their goal (Nguyen et al., 2005b). This information is an important
ground for urban administrators and planners to use to forecast migration
flows in the future.
Despite of the numerous difficulties and barriers, migrants whowant to stay in urban areas will struggle to reach their goal. Therefore,
administrative policy measures aiming to limit migration flows will not
be able to prevent migrants. Rather, such measures will bring fewer
benefits and more costs of migration (Dang, 2005).
Rights to access social security system are for all citizens,
including migrants: Social protection for migrants is crucial for
maintaining, fostering, and developing the labor force in Vietnam, in

3 As mentioned, "ho khau" (resident registration) is considered as a basis for rights to access social
services, such as education, health care, birth and death certificates, water and electricity
contracts, house sales and purchases, construction permission, and business registration

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which rural population and labor account for more than 70 percent of
total population and labor force. The current policy measures aiming tolimit migrants in urban areas by charging higher prices for social services
will take away the economic gains and social benefits that migrants
could have acquired from migration (Le et al., 2005). Actually, poverty
incidence of migrants in urban areas has worsened, with migrants tourban centers having higher poverty rates than do the urban people(Dang, 2005). If urban authorities do not have any policy measure to help
migrants access social services, not only can the migrants' goals, i.e.,
employability and increased income, not be achieved, but also they arepushed into the "urban poor" group. In other words, the rural poor are
migrating to urban areas to become urban poor. Moreover, as flows of
migrants increase, if the current social protection system continues
excluding migrants from basic social services, it will create serious
social problems in urban areas (World Bank, 2004).
From the perspective of social protection, a solution is to provide
appropriate supports to all people so that they can fend for themselves,
thereby reducing poverty and improving living standards. If such a policy
can reach directly to migrants without any barriers, it will not only
reduce unnecessary migration costs, but it also can help eliminate poverty
and hunger for the migrants themselves, their rural hometowns, and theurban areas to which they migrate.
The National Assembly and the government have had somepolicy discussions and made some changes to provide more convenientconditions in dealing with residential registration, and separating
residential registration from other civil rights.4 Residential registration
should return to its original function, in which it was used only for4 According to new regulations in the Residence Law 2006, which was approved on November 29,
2006 and became effective on July 1, 2007, citizens that have lawful residence (those who are living
in a city directly under the central government and have been continuous temporary residents forat least one year) should be considered as permanent residents, including those who live in rented
houses, those who live with friends or relatives, and those who have a home owner's permission
for staying.

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monitoring resident status (i.e., who is living/staying in the area, where
they live, where they are from), which in turn helps local and central
authorities to make socio-economic development plans. Such functioningof resident registration will also provide higher accessibility for migrants
to social services. In other words, it is necessary to separate administrative
relationships (registration-based residential management) from economic
relations (ownership, purchases, and sales of commodities and services)and civil relations (Dang, 2005; Nguyen et al., 2005b).
The remaining question is how to provide urban services to all
people without discriminating based on residential status. This is a highly
important policy issue in urban management. Under the current urban
management and policy making capacity, it will surely take time to makecivil rights and accessibility to social services equal between migrants
and urban people. But it is not impossible to reach this goal.

4. Improving Accessibility to the Social Protection
System for Migrants
4.1. Social Protection for Migrants as an Important Policy Issue in
Urban Management
Results of a survey conducted in Hanoi show negative impacts
made by migrants on the urban areas, including overloaded services
under limited capacity, social evils, and environmental pollution(Nguyen et al., 2005b). This means that the main challenge for the urban
authorities is not migration itself, but various social problems that arise
from increasing flows of migrants who are making low income, bearing
many risks, and receiving little support from society (Le et al., 2005).
If migration is a requisite in economic development, social
protection is a necessary condition for ensuring sustainable development,
especially in developing countries with underdeveloped social security
systems. Policy measures for migration are measures for development
and management, or management of development.

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4.2. The Role of Government in the Social Protection System
Macro policy measures: Doi moi has brought a fundamental
shift in the social welfare system in Vietnam. The "traditional" social
support system, including ensuring employment, subsidizing necessities,
and covering small income differences among population groups, hasbeen eliminated. It has been replaced by a new system in which thegovernment has less control on financing and operation, and market
forces play an increasing role. Along with increasing rates of unemployment
and numbers of low-income people, such changes of the social welfare
system have created vulnerability in many families and impeded theirsubsistence (Le et al., 2005). Therefore, while the direct control of thegovernment on the system is declining, it is necessary to promote
involvement of market forces and economic sectors in the social protection
system (ActionAid, 2005).
Currently, Vietnam is extending the coverage of the social
protection system, which was designed to serve the formal sector. To
cover migrants—an increasingly important part of the labor force withgrowing needs for social protection, and who are mostly working in theinformal sector—such extension requires central and local governments
and all economic sectors to make substantial efforts, especially in financing
and administration. In addition to reforming residential registration, various
efforts to improve urban services and management aiming at equal rights
for migrants and urban citizens are required.
Migration management measures through rural development:
Increasing the coverage of the social protection system will produce apulling force for migration, and thus policies for rural development will
be needed at the same time. For managing migration flows, economic
measures will be more effective than administrative measures, because
the latter are no longer effective under swift social and economicchanges. Many studies, such as Le et al. (2005), Dang (2005), andNguyen et al. (2005b), show that if the living standards of rural people
are improved, their accessibility to social services, such as health careand education and training, is also improved. This will have the effect of
reducing migration flows. Some policy recommendations to manage
migration are as follows.
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Social Protection for Internal Migrants in Vietnam(i)

Direct regional development and reduce the effects of "pull"and "push" factors so that rural development is promoted withouthuge flows of migration.
(ii) Instead of rural-urban migration, create policies that encourage
capital flows from urban areas to rural areas.
(iii) Encourage investments and help create jobs in rural areas.
(iv) Promote vocational training in rural areas, which will help toprovide a better labor force for rural production (Nguyen et al.,2005a).
Measures for protection, prevention, and capacity building:Currently, there are some social protection models for managing migration.
The model proposed by Le et al. (2005) includes three protection levels:the lowest level, namely "protection measures," is used for vulnerable
groups; the middle level, namely "prevention measures," comprises awide range of social protection services; and the highest level, namely"capacity building measures," consists of development strategies andsupporting institutions. To date, migrants are often excluded from measuresof the highest and the middle levels, and only a few of them are provided
full coverage at the lowest level (Le et al., 2005). The social protection
programs need to overcome discrimination and inequality in providing
social services to rural and urban people. In other words, migrants not
only need social support programs that provide charity and kindness, but,
more than that, they need an appropriate social protection system towhich they have the same accessibility as do urban people.
The role of the government is to provide support to migrants sothat they can fend for themselves and their families when they encounter
various opportunities and risks. This is also an essential prevention measure,
as it helps urban areas to mitigate negative consequences caused by huge
flows of migrants, and, at the same time, to strengthen capacity building
for rural people who wish to participate in the urban labor force.
Challenges of these policy measures: There are two main
challenges for implementing the above-mentioned measures: obsolete
views on migrants, and inadequate management mechanisms.

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Pham Quynh Huong

Obsolete views on migrants: Migrants bring both contributions
and risks to urban areas. They are treated in a conflicting manner:
they are considered a plentiful source of labor for the goal of
economic development, but they are also viewed as bringing
strong pressure to guarantee social equality. Overcoming such
obsolete views on migration control, especially the view that
migration is pressing a huge burden on urban infrastructure andsocial services, is a challenging task for urban administrators.
Moreover, rural-urban discriminatory preconceptions also need
to be eliminated so that migrants will be treated the same as therest of the population.
(ii) Inadequate management mechanisms: The previous social
security system was mainly targeted to the people who work forthe public sector, as well as urban people. Recently, the system
has been changed to adapt to the rapid economic and socialtransformation that resulted from Doi moi. While the social
security system has contributed to improvement of people's
living standards, it has also made a widening social gap, in
which some groups with favorable social positions tend toreceive more social protection benefits, while other groups havedifficulty receiving benefits. People with higher living standards
tend to receive higher benefits from social insurance, whilepeople with lower living standards tend to get more benefits
from social assistance (Bui, 2005).
Social security institutions under economic transformation havevarious stakeholders: government, public and non-public enterprises,
mass organizations, families, communities, civil society, individuals, andinternational organizations. For civil society, due to limited institutionalframeworks and management, these institutions are not keeping pacewith urbanization, and thus cannot perform to their full potential (Bui,
2005). In the near future, along with policy changes in residential
registration requirements and regulations on the accessibility to social
services, reforming the institutional frameworks and management will bea must. Whether these policy changes will affect migrants depends on
(i)

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how changes in management regulations attached to resident registration
are specified.
4.3. The Role of the Business Sector in Providing Social Protection
Previous studies, such as Bui (2003) and ActionAid (2005),
indicate that many enterprises are not taking mandatory responsibility
for their workers, of which migrants account for a large proportion. In
fact, many enterprises, by various means, are exploiting migrant laborers'
vulnerable positions to make profits without taking responsibility forthese workers. Currently, working with very short-term contracts, even
without any labor contracts, is common among migrants, and thus they
have no social insurance rights. In particular, in small business enterprises,
the majority of laborers, both migrants and urban citizens, do not have
any labor contracts. Migrant laborers have to cover all of their costly living
expenses with their low wages, and they do not get sufficient support
from employers, especially for health care. Employers also often refuse
to recruit unskilled workers, of which migrants make up a large proportion,
because they do not want to spend time and money training them (Dang,
1998b).
The social protection system does not perform effectively in the
non-public sector, which employs the majority of the labor force. Thissituation is resulting from the lack of necessary policies to deal withthe swift changes of the economic system, and is causing a number ofsocial problems, such as unemployment, disguised unemployment, low
productivity, and lack of regulations on social protections for workers(Bui, 2005).
In order to encourage the business sector to participate in social
protection more effectively, government should provide an appropriate
business environment and help the business sector to (i) ensure betterworking conditions for their laborers; (ii) provide better living conditions
for laborers, which will help them maintain good health; and (iii) mitigatesocial consequences caused by lack of responsibility by employers totheir workers, particularly migrant workers.

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Pham Quynh Huong

4.4. Strengthening the Role of Other Stakeholders
Urban communities: Migrants confront a number of problems
in urban areas due to various reasons, such as lack of formal social
support programs, weak social networks, and lack of assistance fromlocal communities in which they are working and living. Mobilizing thecommunity power will be an important factor in helping migrants toaccess social protection services (Le et al., 2005).
Social networks and urban management: Social networks help
migrants to reduce migration costs, find job opportunities, and integrate
into local communities. Under complicated administrative procedures
and management, such social networks will help migrants to stabilize
their working lives in urban areas through various forms. More importantly,social networks help migrants to deal with unexpected events, such as
sickness, exploitation, abuse, and harassment. In general, social networks
play an important role in helping migrants to cope with numerous socialand economic risks.
Under the current context, improving the operational effectivenessof social networks for migrants will also help improve effectiveness inurban management. To achieve this, mobilizing mass organizations for
migrants are necessary measures. Through social networks for migrants,
counseling and vocational training activities will also become more
effective, as they will be able to meet the real demand of migrants andthe urban labor force.
Non-governmental organizations (NGOs): NGOs in Vietnam
have made a great contribution to social activities in local communities.
Strengthening the role of these organizations will promote social networks
for migrants, as well as help migrants to integrate into local communities.

5. Concluding Remarks
Migration is a life strategy for many rural households. The main
goal of migration is to increase income. However, their rights to social
protection are not sufficiently provided for under the current regulations.

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Social Protection for Internal Migrants in Vietnam

Along with rapid urbanization, migrants should be considered as part ofthe development strategies of urban areas. Policy measures providing
more rights to migrants and making their employers more responsible tothem are important for promoting further urban development.
Overloading of urban areas, which has been partially caused byhuge flows of migrants, is obvious. Such problems can only be solved if
policy measures consider migrants a source of urban development.
Migrants, with economic motivations, explore all possible ways to stayin urban areas, so administrative procedures aiming to limit migration
flows will fail. Such policies will reduce economic gains and increase
migration costs for migrants, who already face considerable economic
and social risks.
Along with economic transformation, all the social entities,
including the government, business sector, mass organizations, families,
communities, civil society, and individuals, need to work together inproviding sufficient social protection for all citizens, particularly vulnerable
and poor groups. One of the most urgent policy measures is to eliminate
resident registration requirements in accessing social services.
A large flow of migrants from rural to urban areas can be foreseen
under rapid economic transition in Vietnam. The question to urban
administrators is how to cope with this trend. If no appropriate and timely
policy measures are taken, urban poverty, social evils, and slums will grow.
Poor living conditions and high migration costs associated withlow accessibility to urban services are making a multitude of difficulties
for migrants. Such conditions also bring poverty from rural areas tourban areas, which in turn make urban poverty more serious. Providing
sufficient social protection for migrants will improve their lives andpromote their success. Appropriate policy measures, like those suggested
in this paper, will not only reduce burdens, but will also contribute tourban development.

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References
ActionAid. 2005. Immigration Labor in Vietnam. Hanoi: ActionAid.
Bui, T. C. 2003. Social Welfare in Vietnam: Situation, Issues, andAdjustment. Hanoi: Institute of Sociology.
_______. 2005. "Theory and Reality of Social Welfare System in
Vietnam." In Trinh Duy Luan (ed.) Social Issues in Vietnam and
Suggested Solutions. Hanoi: Institute of Sociology.
Dang, N. A. 1998a. "Role of Social Network in the Migration Process,"
Review of Sociology, No. 2: 16-23. Hanoi: Institute of Sociology.
_______. 1998b. "To Ensure Social Services Provided to MigrantLaborers in Urban Areas," Review of Sociology, No. 4: 31-36. Hanoi:
Institute of Sociology.
_______. 1999. "Migration and Migration Management in Developing
Period: Ideas of Research Aspect," Review of Sociology, No. 3&4: 3944. Hanoi: Institute of Sociology.
_______. 2005. National Migration: Opportunity and Challenge to
Reform and Development in Vietnam. Vietnam Asian Pacific
Economic Center (VAPEC) Research Report. Hanoi: The Gioi
Publishing House.
Le, B. D; N. A. Dang; T. H. Khuat; H.T. Le; and R. L. Bach. 2005. Social
Protection for the Most Needy in Vietnam. Hanoi: The Gioi
Publishing House.
Nguyen, H. M. 2005. "Eliminate Hunger and Reduction Poverty Programand Challenge New Period." In Trinh Duy Luan (ed.) Social Issues inVietnam and Suggested Solutions. Hanoi: Institute of Sociology.
Nguyen, H. M; M. K. Do; T. H. Phung; Q. H. Pham; N. M. Nguyen; X.
M. Nguyen; Q. L. Tran; and T. T. Dang. 2005a. Rural-Urban
Immigration and Issues of Social Welfare System in Vietnam. Hanoi:
Institute of Sociology.
_______. 2005b. Impact of Resident Registration on Poverty Reduction in
Urban Areas: The Case of Hanoi. Hanoi: Institute of Sociology.
Trinh, D. L. 2004. "The Report Card in Vietnam 2003-2004: First Results

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Social Protection for Internal Migrants in Vietnam

on Education in Nam Dinh." Research report for the World Bank,
Hanoi.
_______. 2005. "Human Resource Issues, Labor, and Jobs in Vietnam in
the Industrialization and Modernization Process." In Trinh Duy Luan(ed.) Social Issues in Vietnam and Suggested Solutions. Hanoi:
Institute of Sociology.
World Bank. 2004. Vietnam Development Report 2004: Poverty. Hanoi:
World Bank.
World Bank. 2005. The Report Card 2003-2004: Approach, Methodology,
and Implementation Process. Hanoi: World Bank (Unpublishedreport).

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Chapter 6
Patterns and Determinants of Living
Arrangements of the Elderly in Vietnam
Giang Thanh Long and Wade Donald Pfau

Abstract
Based on data from the Vietnam Living Standard Surveys in 1992/93 and1997/98 and the Vietnam Household Living Standard Surveys in 2002
and 2004, this paper describes the patterns of living arrangements of theelderly in Vietnam and examines the determinants of such arrangements
over the past decade. We apply multinomial analysis techniques for theseresearch purposes. The estimated results show that family structures inVietnam have generally been maintained despite profound social andeconomic changes since Doi moi: the proportion of elderly living with
their children has remained high. The findings also indicate that theelderly's decisions about whom to live with depended on various factors,
including age, educational attainment, gender, marital status, area andregion of residence, and home ownership. Nevertheless, some worrisome
trends are emerging, such as a decline of elderly being supported by others(but no children), and a rise in elderly living alone.

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Giang Thanh Long and Wade Donald Pfau

1. Introduction
Rapid declines in fertility rates and mortality rates as well as
substantial improvements in health care systems have resulted in thegrowth of elderly populations around the world, and this trend is expected
to continue in the coming years. With the definition of an elderly person
as aged 60 years and over, the medium-variant population projections of
the United Nations in 2006 predict that the number of elderly people will
increase from 672 million in 2005 (or 10 percent of the world population)
to around 2 billion people in 2050 (or 22 percent of the world population)(United Nations, 2007). Particularly for developing countries that willgrow old before becoming rich, population aging in the coming decades
poses various challenges to governments' public policies for protecting
the elderly. Under such demographic changes, as well as profound socialand economic changes stemming from modernization and urbanization,
the traditional family support system has already declined in some developed
countries, including Asia's most economically advanced ones, such as
Japan and Taiwan (United Nations, 2005). If developing countries with
underdeveloped social protection systems follow this pattern, supporting
the elderly will become increasingly difficult in these countries(Karagiannaki, 2005; Schwarz, 2005).
As one of the fastest growing economies in the world, Vietnam
is experiencing the demographic changes just described. The abovementioned population projections indicate that the elderly populationin Vietnam will increase significantly from 7.5 percent of the whole
population in 2005 to about 26 percent in 2050. Moreover, swift economictransformation since Doi moi has had significant impacts on all areas ofsociety, and has resulted in substantial improvements in living standardsof the people, including the elderly. However, while such remarkablesuccesses have been widely acknowledged, many elderly people are still
living in poor and vulnerable conditions, as the majority of them are living
in rural, isolated, and disadvantaged areas. Only a small percentage ofthe elderly in Vietnam are receiving public pensions, while others are living

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Patterns and Determinants of Living Arrangements of the Elderly in Vietnamon their own and/or being supported by family members (National
Assembly's Committee for Social Affairs, 2006). In addition, a potentiallyworrisome issue for supporting the elderly is that the past decade
observed a continuous decline in the number of elderly people living as
dependents, and a continuous increase in the number of elderly people
living alone or in households with only elderly people (Giang and Pfau,
2007). Thus, any reduction in family support caused by the aforementioned
trends will leave the elderly vulnerable to various social and economic
risks. Studies on the changes in patterns and determinants of living
arrangements of the elderly are urgently needed to provide policy directions
for the government in improving social welfare programs.
Even though the number of studies on living arrangements of
the Vietnamese elderly has been increasing over the past decade, most ofthem have merely described the trends of living arrangements; few have
explored the determinants of such arrangements. This paper will address
the gap, and it will seek to quantify the determinants of living arrangementsof the elderly in Vietnam by using data from the Vietnam Living
Standards Surveys (VLSS) in 1992/93 and 1997/98 and the Vietnam
Household Living Standards Surveys (VHLSS) in 2002 and 2004.
Specifically, the paper will answer the questions of how the living
arrangements of the elderly have changed, and what determinants lie
behind these changes. We focus on a number of possible factors: age,gender, educational attainment, marital status, areas and regions of residence,
employment status, per-capita real expenditures, and home ownership.
The remainder of the paper is organized as follows. We review
the relevant studies in Section 2. Then, in Section 3, we present our
methodology with a description of the data and variables. Strengths andlimitations of the data are also discussed. The empirical results with policy
implications are presented in Section 4. The last section provides someconcluding remarks and directions for further studies.
Briefly, we find the following results.

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Giang Thanh Long and Wade Donald Pfau

· Elderly men were more likely than elderly women to livewith their children, and they were less likely to live alone orlive with others (but no children).
· The elderly at more advanced ages were less likely than theyounger elderly to live with their children. They tended tolive alone or with a spouse.
· Educational qualifications were not an important factor for theelderly in deciding with whom they would live.
· Married elderly people were less likely to live with theirchildren.
· The urban elderly tended to live with their children, and they
were less likely to live alone or with others (but no children).
· Significant differences existed between regions in Vietnam.
Elderly people in the north were less likely to live with theirchildren than those in the central regions, who in turn wereless likely to live with their children than the elderly in thesouth.
· Some elderly people were employed in salaried work or in
agriculture, or were self-employed. The majority of theworking elderly were working in the agriculture sector,
and they were less likely to live with their children in allcomparisons, while the other working elderly did not show
concrete trends.
· In general, the elderly living in households with higher
per-capita expenditures were less likely to live with theirchildren, though causality is unclear here because large
households naturally tend to have lower per-capita expenditures.
This factor did not have clear impacts on the decision of theelderly to live with others (but no children).
· Home ownership was a crucial factor for the elderly to
decide their living arrangements. The elderly living in households
where an elderly person owned the home were less likely tolive with their children or others.

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Patterns and Determinants of Living Arrangements of the Elderly in Vietnam

2. A Review of Relevant Literature
The number of studies on the factors that determine the living
arrangements of the elderly has been increasing substantially in recent
years, particularly for developing countries, because of emerging
concerns about aging populations and social protection reforms. Thesestudies have used a variety of data and analytical frameworks. Martin(1989), using the 1984 survey data of the World Health Organization(WHO), uses logit estimation to analyze the determinants of whether or
not elderly people live with their children in Fiji, Korea, Malaysia, and
the Philippines. Multinomial logit estimation is then applied to compare"living alone" with "living with spouse," "living with children," and"living with others," with the same explanatory variables used in the logit
model. For the same objectives, Mba (2002) uses data from the 1996
Census in Lesotho to analyze four types of living arrangements: living
alone, living with spouse only, living with spouse and children, andliving with other relatives. The paper then uses a logit estimation modelfor each of the living types to examine the impacts of various social andeconomic factors.
DaVanzo and Chan (1994) conduct logistic regression analysis
to investigate the determinants of living with adult children for elderly
Malaysians by using data from the Second Malaysian Family Life Survey
between August 1988 and January 1989. Focusing on the determinants
for the Greek elderly to live with their children, Karagiannaki (2005)
applies a probit model to five available cross-sectional data sets from theGreek Household Budget Surveys in 1974-1999. To compare genderdifferences, Chaudhuri and Roy (2007), using data from the fifty-second
round of the national sample survey during July 1995-June 1996,
conduct logit estimation analysis of the determinants of living alone for
the Indian elderly. Using the 1993 Indonesian Family Life Survey,
Cameron (2000) estimates a model of residence choice for Indonesianelderly parents. She uses a nested logit model to analyze various individual
characteristics of both elderly people and their children as determinants
for the elderly to live alone or live with at least one child. Also, United
Nations (2005) provides an extensive analysis of living arrangements of151

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Giang Thanh Long and Wade Donald Pfau

the elderly in more than 50 countries in all five continents by using various
sources of data, such as the Demographic and Health Survey. Different
types of living arrangements are considered, and the logistic estimation
method is also applied to explore the determinants of living alone.
For the elderly people in Vietnam, Knodel et al. (2000) andFriedman et al. (2002) use data from two surveys conducted in the Red
River Delta in 1996 and in Ho Chi Minh City (HCMC) and its six adjacentprovinces in 1997 to explore gender differences between the elderly ofthese locations in receiving support from their children. Various types ofliving arrangements are examined by using the logistic estimation
method. Barbieri (2006) also looks for the determinants of living with achild for all ever-married Vietnamese elderly people by using a logit
model with data from the VLSS 1997/98 and 3-percent public use sampleof the 1999 Census.
Although the social and economic determinants of living
arrangements of the elderly in different countries are diverse, somecommon factors are found in these studies. First, the age of the elderly isa controversial determinant of their living arrangements, depending on
how it is considered in the analysis. DaVanzo and Chan (1994) find thatnone of the age variables are statistically significant when controllingother factors. Similarly, United Nations (2005) shows that the likelihoodof living alone is increased at advanced ages, but age does not always
have a significant impact on this status when other possible factors areincluded. However, some studies demonstrate certain impacts of age on
the living arrangements of the elderly. For instance, the logit estimates in
Martin (1989) show that age has a significantly negative effect on livingwith children in Fiji, Malaysia, and the Philippines, meaning that getting
older results in a lower likelihood for elderly people in these countries tolive with their children. Mba (2002) shows that the elderly in Lesotho,
except the oldest elderly group (aged 80 and over), are generally more
likely to live with their younger children than with their older children.
Also, Karagiannaki (2005) finds that the probability of living with otherrelatives for Greek elderly people increases almost linearly with age. The
estimates from Barbieri (2006) show a lower likelihood for elderly people
at more advanced ages to co-reside with their children.

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Patterns and Determinants of Living Arrangements of the Elderly in Vietnam

Gender is another controversial variable to explain decisions of
the elderly on living arrangements. Cameron (2000) finds that gender
does not help to explain the situation of living alone for Indonesianelderly people when other factors in the model are controlled. This is thesame as the findings of DaVanzo and Chan (1994) for elderly
Malaysians. However, Chaudhuri and Roy (2007) show that elderly
Indian women are almost 75 percent more likely to live alone thanelderly Indian men (2007), and the rate is even higher when consideringother factors, such as income quintile, property ownership, and economic
independence. For the Vietnamese elderly, Barbieri (2006) finds thatwomen are less likely than men to co-reside with a child, but the rate ofco-residence varies with marital status. Friedman et al. (2002) show that,among the elderly living with an adult or married child, married elderly
men and women in the south have no difference, while married elderly
men in the north have a higher likelihood than their female counterparts
to live with an adult or a married child.
The living patterns of elderly people vary with marital status.
Mba (2002) shows that widowed elderly women in Lesotho are most
likely to live alone in comparison with other female groups with different
marital statuses. Karagiannaki (2005) finds that unmarried elderly people
in Greece are 12 percent less likely to live with their children than theirmarried counterparts, and widowed and divorced elderly people are 23
percent more likely to live with their children and other younger relatives
than are elderly couples (2005). For the case of Vietnam, Barbieri (2006)
discovers that married elderly people are less likely than their widowed,
separated, or divorced counterparts to live with a child. In explaining
these findings, most of the papers argue that such situations are common
because women usually live longer than men and marry men who are
older than themselves, and thus, in comparison with men at the same age,
women are more likely to be widowed and have older children.
Educational attainment has different impacts on the living
arrangements of the elderly in different countries, and there is a substantial
difference between elderly men and women. Martin (1989) and Cameron153

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Giang Thanh Long and Wade Donald Pfau

(2000) find that education generally does not have a systematic effect on
the decision of the elderly to live with their children. However, Mba(2002) discovers that, in Lesotho, elderly women with secondary andhigher education as highest degree are more likely to live alone than theircounterparts with primary education. Chaudhuri and Roy (2007), studying
the Indian elderly, show that being illiterate is associated with a higher
probability of living alone. In Vietnam, the literate elderly are found tohave a lower likelihood of living with a child than their illiterate counterparts(Barbieri, 2006). In its comparative study, United Nations (2005) showsthat, after controlling for effects of the other variables, education shows
positive effects in 13 countries and negative effects in 14 countries (outof 69 countries examined) on the probability of living alone for the elderly.
Living locations in rural and urban areas correspond to significant
differences in the living arrangements of the elderly. Two striking findings
are that elderly residents of rural areas are more likely to live alone thantheir counterparts in urban areas (Mba, 2002; United Nations, 2005; andChaudhuri and Roy, 2007), and that the likelihood to co-reside with achild (or children) is higher in urban than in rural areas (Cameron, 2000;
Barbieri, 2006). A popular possible explanation for these differences inmost of the studies is the higher housing costs in urban areas. In exploring
the regional effect in Vietnam, Friedman et al. (2002) show that thepredicted rate of co-residence with an adult or married child for theelderly in the south is higher than that for the elderly in the north.
Barbieri (2006) also demonstrates that the elderly in both the central andsouthern regions have higher likelihoods to live with a child than thosein the north.
Income level and employment status, which are considered as
financial indicators for the elderly, are important determinants. In India,
both elderly men and women with higher incomes are more likely to live
alone (Chaudhuri and Roy, 2007). This finding is the same as that of
Karagiannaki (2005) for the Greek elderly. However, DaVanzo and Chan
(1994) find that the impact of income on the elderly's co-residence withchildren depends on their marital status, in which unmarried elderly154

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Patterns and Determinants of Living Arrangements of the Elderly in Vietnam

people with high income levels are less likely to live with their children
than their married counterparts.
Home ownership is also a popular factor in examination.
Karagiannaki (2005) finds that home ownership has a significantly
negative effect on co-residence of the Greek elderly with their children.
Similarly, Chaudhuri and Roy (2007) discover that Indian widows withproperty have a higher likelihood of living alone. The Korean and
Malaysian elderly share this situation, as explained in Martin (1989).
In addition to these factors, some studies discuss a number ofother determinants, such as the number of surviving children, healthstatus, and the number of years of living at the current residence. The
impacts of these factors on the decisions of the elderly regarding theirliving arrangements vary across the countries and depend on theirsocio-economic characteristics.

3. Methodology, Data, and Variables
3.1. Methodology
We will apply multinomial analysis techniques to explore thepatterns and determinants of the living arrangements of the elderly in
Vietnam over the past decade. We define the elderly as those who are atleast 60 years old, and an elderly household is one having at least one
elderly person. Three types of living arrangements among elderly people
will be examined: (i) living alone or with a spouse only, (ii) living with
their children, and (iii) living with others, but no children. The possible
determinants of these living arrangements, which will be discussed ingreater detail later in this section, are age, gender, educational level,marital status, areas and regions of residence, employment status, expenditurequintile, and home ownership. These explanatory variables will be used toshow how the elderly who live with their children and those who live withothers differ from the elderly who live alone or with a spouse only.
As indicated in several existing studies, e.g., Martin (1989) and
Cameron (2000), such division of living arrangements of the elderly
needs to be considered carefully in elucidating the contrasting outcomes.

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Giang Thanh Long and Wade Donald Pfau

For instance, Martin (1989) raised such related questions as whether theelderly who are living alone or with other relatives are more likely
to be destitute and without surviving children, and how demographic
characteristics of an elderly person's spouse can change the probabilityof the alternative living arrangements. Furthermore, children playdifferent roles and have different statuses in elderly households; they
may be the household head or a dependent. Children may also be
married or unmarried. Such differences can influence the elderly's
decisions on whether or not to live with a child (or children). Given
limitations in each data set and inconsistencies between data sets,
however, these issues will not be covered in this paper. Rather, we use
only individual and household characteristics of the elderly to pursue theresearch objectives.
3.2. Data and Variables
To pursue the research objectives, we will use data from theVietnam Living Standard Surveys in 1992/93 and 1997/98(VLSS1992/93 and VLSS1997/98, respectively) and the Vietnam
Household Living Standard Surveys in 2002 and 2004 (namely
VHLSS2002 and VHLSS2004, respectively). These surveys wereconducted by the General Statistics Office of Vietnam (GSO) along withother international agencies, as a part of the World Bank's Living
Standard Measurement Surveys (LSMS). Detailed descriptions of thesesurveys can be found in numerous research reports, such as Grosh andGlewwe (1998), GSO (2004a and 2004b), and World Bank (2000, 2001,
and 2005).
The surveys are organized by household, but they also include
some characteristics for individuals in the household, such as age, gender,
relationship to the household head, marital status, working status, salary,
health, and education. The surveys also provide identification ofparent(s) if they live in the household. This structure lets us identify theelderly people as well as the households that include elderly people.
Table 1 provides information on the sample sizes for the four surveys.

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Patterns and Determinants of Living Arrangements of the Elderly in Vietnam

Table 1: Number of Households and Individuals in the V(H)LSS
Year

Number of Households

Number of Individuals

1992/93

4,800 (1,514)

24,068 (2,047)

1997/98

6,002 (2,121)

28,633 (2,860)

2002

29,530 (8,759)

132,384 (11,940)

2004

9,189 (2,784)

39,696 (3,806)

Note: The number of elderly households and the number of elderly people are in parentheses.

Source: Authors' calculations from VLSS 1992/93 & 1997/98, and VHLSS 2002 & 2004.

At the household level, the surveys provide extensive data on
sources of income, business and agricultural enterprises, detailed household
expenditures, ownership of consumer durables, poverty incidence, poverty
alleviation programs, wealth, and housing conditions. The households
are representative of the entire Vietnamese population, both urban andrural, and across the regions, so we can observe changes in the living
arrangements of the Vietnamese elderly over the past decade as theyexperienced profound social and economic changes.
The data has some limitations. First, we generally only haveinformation about relatives who live in the same household (particularlyin the later surveys), and therefore it is difficult to identify other relatives
who may be living nearby or migrating to other areas. The only exception
to this problem is that we have information about all children living outside
the household in VLSS1997/98. Second, besides wages, most income
sources are only identified at the household level, so it is not clear which
member is the source of the income. Similarly, expenditure is also identified
at the household level, so we do not know who is doing the spending.
Wealth data are only available at the household level. These problems
limit the analysis of intra-household sharing.
In the multinomial analysis, we will use the following independent
variables to analyze the living arrangements of the elderly in Vietnam.
(1) Age: The elderly will be divided into three groups, including
young elderly (aged 60-69); older elderly (aged 70-79), and157

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Giang Thanh Long and Wade Donald Pfau

(2)
(3)

(4)

(5)

(6)

(7)

oldest elderly (aged 80 and over). We will use the young elderly
as the reference group.
Gender: We will use female as the reference group in our analyses.
Educational level: Many variables in these surveys can represent
the educational level of the elderly. For instance, Giang and
Pfau (2007) use reading and writing ability of the elderly as
proxy for education. In this paper, however, we will use thehighest educational degree by an elderly person to be indicatorof his/her educational level. The educational levels are (i) no
education; (ii) primary education; (iii) secondary education(including lower- and upper-secondary); (iv) vocational education(including vocational and technical training); and (v) higher
education (including college, undergraduate, and post-graduate).
The elderly group with no education will be the referencegroup.
Marital status: We will differentiate between the elderly who
are married and the elderly who have other marital statuses(e.g., widowed, divorced, separated, and never married). The
group of elderly with other marital statuses will be the referencegroup.
Areas of residence: We will consider the differences between
elderly residents in rural and urban areas, in which rural areas
will be the reference group.
Regions of residence: We will focus on three main regions of thecountry: the north (including Red River Delta, Northeast, andNorthwest), the center (including North Central Coast, South
Central Coast, and Central Highlands), and the south (includingSoutheast and Mekong River Delta). The central region will be
the reference group.
Employment status: Since employment may be an appropriate
proxy for economic independence of the elderly, we need todecompose the types of employment. Here we have three types:
employment with salary or wage (or paid work), employment in

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Patterns and Determinants of Living Arrangements of the Elderly in Vietnam

(8)

(9)

the agriculture sector, and self-employment. We use the groupof elderly who were not working as the reference group.
Household expenditure quintile: As mentioned earlier, because
we do not have individual data about expenditures for thehousehold members, including the elderly, it is difficult to know
who is doing the spending. We use per-capita real expenditure
as a proxy for the economic capacity of each elderly household.
The bottom expenditure quintile (or the poorest group) will be
the reference group.
Home ownership: We will differentiate between households inwhich an elderly member owns the home and other households
where this is not the case. The group of elderly people who do
not own the house will be the reference group.

4. Results and Analysis
Here we seek to explain the determinants of the living arrangementsof the elderly in Vietnam. Our discussion will first consider tabulations
by various characteristics and then provide a detailed analysis using
multinomial regression.
4.1. General Characteristics of the Vietnamese Elderly Population
Table 2 provides general information about the Vietnameseelderly for a number of characteristics.
We can observe that the population of Vietnam has aged, as thepercentage of the elderly population in the older groups (70 and over) has
grown over time, while the proportion of the young elderly (60-69) has
grown smaller. More specifically, the population aged 80 and older
accounted for only 8.55 percent of the elderly population in 1992/93, but
it accounted for 15.16 percent in 2004. Accompanying the aging process
is an increasing percentage of female elderly (from 56.81 percent of thetotal elderly population in 1992/93 to 58.42 percent in 2004) andwidowed elderly (from 33.9 percent in 1992/93 to 36.99 percent in 2004).

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Giang Thanh Long and Wade Donald Pfau

Table 2: Characteristics of the Vietnamese Elderly Population(Percentage of elderly across demographic categories)
1992/93

1997/98

2002

2004

60 - 64

36.15

29.65

26.68

26.88

65 - 69

24.33

27.59

24.70

22.75

70 - 74

20.17

20.03

21.58

21.18

75 - 79

10.80

12.45

13.53

14.03

80 - 89

7.72

9.13

11.57

12.85

90 and older

0.83

1.15

1.94

2.31

Male

43.19

41.93

42.79

41.58

Female

56.81

58.07

57.21

58.42

Married

64.05

61.63

61.69

60.51

Widowed

33.90

35.81

36.44

36.99

Others

2.05

2.56

1.87

2.50

Urban

22.27

25.94

23.17

26.67

Rural

77.73

74.06

76.83

73.33

Red River Delta

23.95

23.78

25.35

25.78

Northeast

13.11

13.73

10.89

10.46

Northwest

1.83

1.73

2.13

1.93

North Central Coast

13.06

14.48

13.87

12.59

South Central Coast

10.89

8.68

9.79

9.93

Central Highlands

2.03

1.85

4.01

3.40

Southeast

13.61

15.55

14.03

15.36

Mekong River Delta

21.52

20.20

19.93

20.55

No

63.48

62.28

60.57

58.41

Primary

20.77

21.46

22.16

22.34

Secondary

11.47

12.34

12.53

12.61

Vocational

2.19

2.03

2.80

4.04

Higher

2.09

1.89

1.94

2.60

Age

GenderMarital Status

Urban / Rural Status

RegionEducation (Highest Degree)

Source: Authors' calculations from VLSS 1992/93 & 1997/98, and VHLSS 2002 & 2004.

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Patterns and Determinants of Living Arrangements of the Elderly in Vietnam

By marital status, the majority of elderly people were married or
widowed, while the percentage of the elderly with other marital statuses(divorced, separated, or never married) remained very small.
The data also show that the majority of the elderly were living
in rural areas (over 70 percent), but this percentage decreased over timeon account of increasing urbanization. Moreover, the data show that
almost half of the elderly were living in the Red River Delta and the
Mekong River Delta, where agriculture-based activities are still popular.
By educational level, more than half of the elderly population
did not have any education, but this proportion decreased over time. The
elderly with primary and secondary education accounted for about 20
percent and 11 percent of the elderly population, respectively. The
percentage of the elderly with vocational and higher education was still
small, but it increased over time. This trend reflects the fact that the
younger people with such educational levels became elderly across thesurveys.
4.2. Patterns of Living Arrangements in Elderly Households
Tables 3 and 4 provide detailed information for three types ofliving arrangements for elderly people: (i) living alone or with a spouse;(ii) living with their children; and (iii) living with others, but no children.
Table 3 shows the percentage of each category of living arrangements foreach value of independent variables, while Table 4 indicates the percentage
held by each value of the independent variables for each category of living
arrangements.
As can be seen in Table 3, during the past decade, more than 70
percent of the elderly in Vietnam were living with their children, and thispercentage remained stable over time. At the same time, there was anincrease in the proportion of the elderly living alone or with a spouse,
especially the elderly at more advanced ages. For instance, among theelderly aged 80 and over, the proportion of the elderly living alone orwith spouse increased from 8 percent in 1992/93 to 14.56 percent in161

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Giang Thanh Long and Wade Donald Pfau

2004. For each category of living arrangements, the proportion of theelderly at more advanced ages also tended to increase (Table 4).
By gender, Table 3 shows that the percentage of the elderly men
living with their children was always greater than that of their female
counterparts, but the situation was the opposite with the elderly living
alone or with a spouse. The results (not shown) indicate that elderly men
tended to live with a spouse rather than to live alone, while elderly
women tended to live alone. In addition, Table 4 shows that the percentage
of elderly women was always greater than that of elderly men. Thesefindings can be explained by the differences in marital patterns and life
expectancies between men and women.
In terms of marital status, both the elderly who were married
and those in other marital statuses tended to live with their children.
However, the proportion of the married elderly living alone or with aspouse was always higher than that of their counterparts. This comment
is supported by estimates from Tables 3 and 4.

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Table 3: Statistical Summary of the Indicators

Number of elderly% of the elderly population
Age
60-69
70-79
80+
GenderMale
FemaleMarital Status
Married
Other Statuses
Area
Urban
Rural
RegionNorth
CentralSouth

Living Arrangements

2,047
77.43
81.58
70.03
74.86
79.41
75.92
76.96
78.26
83.11
75.83
74.93
73.14
84.79

11.55
19.09
8.00
13.46
13.67
16.25
8.83
8.67
14.97
18.07
16.57
6.62

LivingwithChildren

13.58

LivingAlone
or withSpouse1992/93

7.00
10.29
8.59

8.22
9.20

6.79
12.91

7.13
10.40

6.87
10.88
17.14

8.99

Livingwith
Others

2002

22.74
15.02
21.43

12.92
17.92

19.18
11.97

15.44
17.04

14.48
21.45
11.22

16.36

69.65
76.44
71.26

79.85
75.33

74.96
77.12

76.63
75.20

79.17
70.75
73.81

2,860
76.80

7.61
8.54
7.31

7.23
6.75

5.86
10.90

7.93
7.76

6.35
7.80
14.97

6.84

20.74
15.79
12.73

14.07
19.83

20.61
13.17

16.10
18.17

14.83
22.04
12.31

17.43

73.73
74.16
80.78

80.36
76.98

76.23
80.16

78.65
77.07

80.51
74.76
75.22

11,940
76.74

5.53
10.06
6.49

5.58
3.19

3.16
6.67

3.25
4.76

4.66
3.19
12.47

5.83

LivingLivingLiving Living
Living Living
Alone
Alone
with
with
with
with
or withor withChildren Others
Children Others
SpouseSpouse1997/98

2004

21.52
23.31
13.49

15.27
20.63

23.44
13.20

19.42
19.28

16.99
24.70
14.56

19.34

74.21
71.50
82.94

77.32
76.08

73.91
80.64

76.59
76.23

78.82
72.69
76.95

3,806
76.37

LivingLivingAlone
withor withChildren
Spouse(Breakdown of each category of living arrangements across independent variable values)

4.27
5.19
3.57

7.42
3.29

2.95
6.16

4.00
4.48

4.18
2.61
8.49

4.29

Livingwith
OthersPatterns and Determinants of Living Arrangements of the Elderly in Vietnam

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79.92
78.78
79.07
74.55
72.50
78.30
76.77
76.37
74.88
74.01
74.51
72.11
77.84
80.68
84.72

10.71
15.66
16.90
17.59
18.88
19.61
20.84
13.64
9.29
3.64

LivingwithChildren

13.44
16.19
16.28
16.73
18.33

LivingAlone
or withSpouse

15.48
23.03
17.60
13.12

5.88
7.05
8.52
10.03
22.47

10.19
16.17
17.37
19.67
21.14

10.99
7.57
6.73
7.53
7.11

11.64

14.73
18.64
18.31
18.97
20.81

LivingAlone
or withSpouse

6.65
5.04
4.65
7.73
9.17

Livingwith
Others

10.71
4.00
6.74
9.76
1.23

76.30

8.33
7.66
7.12
6.51
6.12

6.32
4.47
8.50
10.34
8.78

Livingwith
Others

73.81
72.97
75.66
77.12

81.48
76.17
75.51
73.83
72.74

78.95
76.89
73.19
70.69
70.41

LivingwithChildren

1997/98

6.42

6.54
7.14
7.18
4.13

14.57
17.31
19.46
20.32
20.28

15.42
19.07
20.94
21.54
22.31

LivingAlone
or withSpouseSource: Authors' calculations from VLSS 1992/93 & 1997/98, and VHLSS 2002 & 2004.

Highest Education
No
Primary
Secondary
Vocational
HigherExpenditure Quintile
BottomQuintile 2
Quintile 3
Quintile 4
Top
Employment
Paid work
Agriculture
Self-employment
Not working
House Ownership
Yes

Living Arrangements

1992/93

76.98

75.20
70.45
73.34
83.04

80.61
77.99
75.40
74.97
73.49

79.04
76.67
72.33
68.12
68.10

LivingwithChildren

2002

16.60

18.26
22.42
19.48
12.83

4.81
4.69
5.14
4.71
6.23

5.54
4.26
6.73
10.34
9.59

Livingwith
Others

22.07

25.32
28.29
27.62
12.75

15.49
18.22
21.24
22.22
24.46

18.69
21.35
21.49
21.91
22.16

LivingAlone
or withSpouse

75.15

66.23
69.51
69.61
81.88

80.86
78.59
75.60
74.03
70.74

76.91
75.07
72.83
69.27
67.71

LivingwithChildren

2004

2.79

8.45
2.20
2.77
5.37

3.65
3.19
3.16
3.75
4.80

4.40
3.58
5.68
8.82
10.13

Livingwith
OthersGiang Thanh Long and Wade Donald Pfau

Table 4: Statistical Summary of the Indicators

77.43
63.72
28.02
8.26
44.29
55.71
63.66
36.34
23.75
76.25
37.16
24.86
37.98

2,047
13.58
51.44
43.53
5.04
42.81
57.19
76.62
23.38
14.13
85.87
51.08
31.29
17.73

Number of elderly% of the elderly population
Age
60-69
70-79
80+
GenderMale
FemaleMarital Status
Married
Others
Area
Urban
Rural
RegionNorth
CentralSouth

LivingwithChildren

LivingAlone
or withSpouseLiving Arrangements

1992/93

29.89
29.35
40.76

21.76
78.24

48.37
51.63

34.24
65.76

46.20
37.50
16.30

8.99

Livingwith
Others

47.22
32.69
20.09

24.57
75.43

71.37
28.63

39.96
60.04

50.64
42.31
7.05

2,860
16.36

LivingAlone
or withSpouse

31.23
26.29
42.48

31.55
68.45

60.19
39.81

42.80
57.20

59.78
30.12
10.10

76.80

LivingwithChildren

1997/98

33.04
24.10
42.86

40.63
59.37

45.54
54.46

42.86
57.14

46.43
32.14
21.43

6.84

Livingwith
Others

42.53
29.12
28.35

16.95
83.05

66.93
33.07

24.35
75.65

36.21
45.45
18.34

11,94017.43

LivingAlone
or withSpouse

38.20
26.08
35.72

23.39
76.61

60.41
39.59

43.16
56.84

53.21
33.71
13.08

76.74

LivingwithChildren

2002

49.15
32.59
18.26

20.95
79.05

80.78
19.22

46.27
53.73

47.81
37.91
14.18

5.83

Livingwith
Others

44.57
32.34
23.09

19.02
80.98

73.51
26.49

41.58
58.42

43.61
44.97
11.42

3,806
19.34

LivingAlone
or withSpouse(Breakdown of the independent variable values across each category of living arrangements)

38.91
25.11
35.98

24.39
75.61

58.45
41.55

41.52
58.48

51.22
33.51
15.27

76.37

LivingwithChildren

2004

39.88
32.52
27.60

41.74
58.26

58.28
41.72

38.65
61.35

48.47
25.47
26.06

4.29

Livingwith
OthersPatterns and Determinants of Living Arrangements of the Elderly in Vietnam

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166

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61.82
23.96
7.44
4.48
2.30
17.98
19.18
20.57
20.88
21.39
2.40
30.35
8.64
58.61
63.28

14.03
22.30
22.30
22.30
19.07
3.60
50.00
8.63
37.27
91.01

LivingwithChildren

58.28
27.61
8.58
4.30
1.23

LivingAlone
or withSpouse

2.78
45.51
10.04
41.67

1.63
25.54
8.15
64.68
93.59

9.40
16.24
19.44
27.78
27.14

21.74
16.30
15.22
17.39
29.35

17.93

54.19
31.71
10.04
2.35
1.71

LivingAlone
or withSpouse

64.38
19.18
8.48
6.59
1.37

Livingwith
Others

4.02
16.52
8.04
71.42
12.50

68.59

16.07
16.07
15.18
19.20
33.48

51.34
28.89
13.39
2.68
3.70

Livingwith
Others

2.86
31.13
9.32
56.69

16.24
16.51
19.88
22.51
24.86

47.92
34.53
12.73
2.89
1.93

LivingwithChildren

1997/98

89.06

3.70
50.54
11.86
33.90

16.80
19.57
20.34
20.80
22.50

73.25
15.72
7.48
2.01
1.54

LivingAlone
or withSpouseSource: Authors' calculations from VLSS 1992/93 & 1997/98, and VHLSS 2002 & 2004.

Highest Education
No
Primary
Secondary
Vocational
HigherExpenditure Quintile
BottomQuintile 2
Quintile 3
Quintile 4
Top
Employment
Paid work
Agriculture
Self-employment
Not working
House Ownership
Yes

Living Arrangements

1992/93

74.64

2.97
34.86
8.52
53.65

20.68
22.07
20.14
21.31
17.80

70.70
16.92
7.99
2.69
1.70

LivingwithChildren

2002

16.38

3.33
36.24
10.45
49.98

17.56
19.85
20.60
21.09
20.90

60.25
20.70
10.67
5.19
3.19

Livingwith
Others

95.38

5.30
54.08
13.59
27.03

16.17
18.61
22.83
23.10
19.29

57.34
21.20
13.72
5.57
2.17

LivingAlone
or withSpouse

75.40

3.51
33.64
8.67
54.18

21.36
20.33
20.57
20.67
17.06

62.77
18.03
12.52
4.27
2.41

LivingwithChildren

2004

14.11

3.98
33.02
6.13
56.87

17.18
14.72
15.34
18.40
34.36

55.21
16.04
17.18
6.59
4.98

Livingwith
OthersGiang Thanh Long and Wade Donald Pfau

Patterns and Determinants of Living Arrangements of the Elderly in Vietnam

Among the elderly living in urban areas, the percentage of thoseliving with their children was predominant. The proportions of the elderly
living alone or with a spouse in both urban and rural areas increased overtime (Table 3). The majority of the elderly living alone or with a spouse
were living in rural areas, but the proportion of rural elderly in thiscategory declined over time (Table 4). This was due to the fact that mostof the elderly in Vietnam are still living in rural areas, and urbanization
has been in progress.
In all three main regions, most of the elderly were living with
their children, and this proportion fluctuated over the decade. Also, in all
regions, the proportion of the elderly living alone or with a spouseincreased over time, while that of the elderly living with others tended todecrease. The southern region had the highest proportion of elderly
living with their children, while the northern and central regions had
significantly lower proportions of such elderly people. The estimates by
category in Table 4 show that the vast majority of the elderly living alone
or with a spouse were in the northern and central regions, though theresults (not shown) indicate that proportions of the elderly population inthese regions were relatively equal over time. One explanation for thesituation may be the exodus of the young people from rural to urban
areas, and from the northern and central regions to the southern region
with flourishing industrial zones, and this could result in the elderly
being left behind to live alone, with a spouse, or with others, rather thanwith their children.
Decomposition of educational level for the elderly in different
categories of living arrangements in Table 3 reveals interesting trends.
While the majority of the elderly people were living with their children,
the proportion decreased with increasing educational levels in favor ofelderly living alone or with a spouse. In other words, the elderly withhigher educational levels were more likely to live alone or with a spousethan to live with their children.
Similar trends are also observed with five expenditure quintiles
as the percentage of elderly people living with their children declined as

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Giang Thanh Long and Wade Donald Pfau

per-capita real expenditures increased. Again, elderly people were more
likely to live alone or with a spouse for higher expenditure quintiles.
The estimates for employment of the elderly in Table 3 showthat the elderly living with their children accounted for a large proportionof the elderly working (more than 70 percent), regardless of the type ofwork. This finding indicates that the elderly were playing important rolesin these households, and in many cases it could be more reasonable tothink of the children as dependents rather than vice versa (Giang andPfau, 2007). Moreover, among working elderly people, those living alone
or with a spouse and those living with others accounted for merely
20 percent and 10 percent, respectively. By each category of living
arrangements, Table 4 indicates that the percentage of the elderly working
for pay was relatively small, and it did not vary significantly over time.
Most of the elderly were working in the agriculture sector. Those who
were self-employed accounted for less than 10 percent of the elderly
population in each living arrangement category. About half of the elderly
were not working.
The statistics also indicate that more than 70 percent of theelderly living with their children were living in homes owned by anelderly person (Table 3). In each category of living arrangements, about
90 percent of the elderly living alone or with a spouse were the ownersof the current home, while a very small percentage of the elderly livingwith others (but no children) were the home owners.
4.3. Determinants of Living Arrangements of the Elderly:
Multinomial Logit Results
To explore in greater detail the living arrangements of theelderly in Vietnam, we use multinomial logit estimation to compare threeoutcomes: living alone or with a spouse; living with their children; andliving with others, but no children. The group of elderly living alone orwith spouse will be our comparison group.

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Patterns and Determinants of Living Arrangements of the Elderly in Vietnam

Table 5a: Results of the multinomial logit estimation for living
arrangements "Live with Children" vs. "Live Alone or with Spouse"
Independent
Variables
GenderFemale (ref.)MaleAge
Age 60-69 (ref.)Age 70-79
Age 80+Highest Education
No (ref.)
Primary
Secondary
Vocational
HigherMarital Status
Others (ref.)MarriedAreas
Rural (ref.)
Urban
RegionCentral (ref.)
North
South
Employment
Not working (ref.)Paid work
Agriculture
Self-employment
Expenditure Quintile
Bottom (ref.)Quintile 2
Quintile 3
Quintile 4
Top
House Ownership
No (ref.)
Yes
Constant
No. observations
Prob. > chi2
Log likelihood
Pseudo R2

1992/93
Odds
ratio

P>z

1997/98
Odds
ratio

P>z

2002
Odds
ratio

P>z

2004
Odds
ratio

P>z

1.000
1.765

0.001

1.000
1.511

0.002

1.000
1.219

0.087

1.000
1.556

0.000

1.000
0.242
0.310

0.000
0.001

1.000
0.368
0.526

0.000
0.007

1.000
0.405
0.408

0.000
0.000

1.000
0.358
0.366

0.000
0.000

1.000
0.771
0.525
0.996
1.763

0.214
0.067
0.993
0.496

1.000
0.937
1.391
1.064
0.945

0.628
0.135
0.874
0.904

1.000
1.326
0.770
0.398
0.395

0.069
0.264
0.009
0.023

1.000
0.970
1.149
0.841
1.367

0.799
0.408
0.451
0.318

1.000
0.532

0.001

1.000
0.715

0.014

1.000
0.473

0.000

1.000
0.653

0.000

1.000
1.407

0.112

1.000
1.623

0.001

1.000
1.738

0.000

1.000
1.426

0.004

1.000
0.639
3.012

0.007
0.000

1.000
0.657
2.752

0.001
0.000

1.000
0.764
1.739

0.017
0.000

1.000
0.937
2.062

0.542
0.000

1.000
0.587
0.543
0.782

0.190
0.000
0.341

1.000
0.780
0.761
0.851

0.470
0.033
0.396

1.000
0.462
0.284
0.515

0.003
0.000
0.000

1.000
0.459
0.485
0.546

0.000
0.000
0.000

1.000
0.566
0.575
0.482
0.412

0.018
0.020
0.003
0.001

1.000
0.564
0.509
0.365
0.277

0.008
0.001
0.000
0.000

1.000
0.862
0.737
0.676
0.405

0.319
0.041
0.009
0.000

1.000
0.755
0.597
0.538
0.390

0.057
0.000
0.000
0.000

1.000
0.127
137.322

0.000
0.000

1.000
0.137
73.778

0.000
0.000

1.000
0.153
77.941

0.000
0.000

1.000
0.149
73.045

0.000
0.000

2,047
0.0000-1234.475
0.12062,860
0.0000-1648.2815
0.1833

11,9400.0000-6462.896
0.17263,806
0.0000-2081.2084
0.1696

Source: Authors' calculations from VLSS 1992/93 & 1997/98, and VHLSS 2002 & 2004.

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Giang Thanh Long and Wade Donald Pfau

Table 5b: Results of the multinomial logit estimation for living arrangements"Live with Others" vs. "Live Alone or with Spouse"
1992/93
Independent Var.
GenderFemale (ref.)MaleAge
Age 60-69 (ref.)Age 70-79
Age 80+Highest Education
No (ref.)
Primary
Secondary
Vocational
HigherMarital Status
Others (ref.)MarriedAreas
Rural (ref.)
Urban
RegionCentral (ref.)
North
South
Employment
Not working (ref.)Paid work
Agriculture
Self-employment
Expenditure Quintile
Bottom (ref.)Quintile 2
Quintile 3
Quintile 4
Top
House Ownership
No (ref.)
Yes
Constant
No. observations
Prob. > chi2
Log likelihood
Pseudo R2

Odds
ratio

P>z

1997/98
Odds
ratio

P>z

2002
Odds
ratio

2004
P>z

Odds
ratio

P>z

1.000
1.542

0.077

1.000
2.243

0.000

1.000
0.747

0.023

1.000
1.659

0.040

1.000
0.412
0.697

0.000
0.375

1.000
0.248
0.495

0.000
0.030

1.000
0.803
1.429

0.071
0.033

1.000
0.168
0.361

0.000
0.001

1.000
0.469
0.330
1.874
0.839

0.032
0.073
0.291
0.892

1.000
0.508
1.249
1.481
2.796

0.003
0.536
0.536
0.106

1.000
1.727
1.087
0.769
0.826

0.001
0.738
0.474
0.660

1.000
0.791
1.481
1.266
4.594

0.456
0.304
0.620
0.007

1.000
0.376

0.000

1.000
0.621

0.037

1.000
0.955

0.000

1.000
0.605

0.050

1.000
1.044

0.884

1.000
1.548

0.080

1.000
1.378

0.030

1.000
1.803

0.024

1.000
0.387
1.978

0.000
0.012

1.000
0.546
2.748

0.011
0.000

1.000
0.772
0.857

0.037
0.278

1.000
0.460
1.190

0.001
0.517

1.000
0.554
0.576
1.047

0.397
0.021
0.902

1.000
1.142
1.136
0.994

0.816
0.624
0.986

1.000
0.636
0.589
0.714

0.116
0.000
0.047

1.000
0.911
0.745
0.507

0.839
0.281
0.094

1.000
0.431
0.386
0.401
0.612

0.012
0.005
0.007
0.146

1.000
0.630
0.589
0.422
0.439

0.168
0.116
0.008
0.020

1.000
1.128
1.057
1.009
0.844

0.471
0.742
0.958
0.357

1.000
0.867
0.739
0.767
1.050

0.665
0.361
0.424
0.894

1.000
0.124
24.827

0.000
0.000

1.000
0.008
22.413

0.000
0.000

1.000
0.084
3.457

0.000
0.000

1.000
0.005
16.857

0.000
0.000

2,047
0.0000-1234.475
0.12062,860
0.0000-1648.2815
0.1833

11,9400.0000-6462.896
0.17263,806
0.0000-2081.2084
0.1696

Source: Authors' calculations from VLSS 1992/93 & 1997/98, and VHLSS 2002 & 2004.

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Patterns and Determinants of Living Arrangements of the Elderly in Vietnam

Tables 5a and 5b show the odds ratios to compare the referencegroup with other relevant groups. When the odds ratio is greater thanunity, the relevant group(s) will provide a higher probability than the referencegroup. Conversely, an odds ratio smaller than unity shows that the relevantgroup(s) will provide lower probability than the reference group.
In addition, we also provide the p-value for each estimate. The
p-value indicates the statistical significance for whether a group isdifferent from the reference group. We generally conclude that there is astatistically significant difference if the p-value is less than 10 percent, or 0.1.
All the odds ratios for the gender indicator in both Tables 5a and5b are statistically significant. Table 5a indicates that elderly men weremore likely than their female counterparts to live with their children.
The estimated odds ratios for the age groups of 70-79 and 80
and over demonstrate that the elderly at more advanced ages were more
likely than their younger counterparts to live alone or with a spouse. The
findings for the elderly living with others are similar, except for
the group aged 80 and over because the odds ratio of this group is notstatistically significant. It might be that as the elderly were getting older,their children were also getting older and moving out of the house to look
for a job, or get married and live separately from their parents. The result(not shown) that the percentage of elderly living with their grandchildren
increased over time could in part elucidate this finding. To support thisargument more concretely, though, we need to explore further with theindividual characteristics of the elderly's children.
In general, the odds ratios for all educational levels shown in
Tables 5a and 5b are not statistically significant. This means that education
was not an important factor in decisions by the elderly on living with
their children or with others in comparison with living alone or with aspouse.
The estimated odds ratios for the variable representing marital
status in both Tables 5a and 5b show that the married elderly were lesslikely than their counterparts (separated, divorced, widowed, or nevermarried) to live with their children or live with others. In other words, the171

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Giang Thanh Long and Wade Donald Pfau

married elderly were more likely than other elderly people to live alone
or with a spouse.
Except for the survey in 1992/93, all the odds ratios for theurban variable in both tables are greater than unity and statisticallysignificant. This indicates that the urban elderly were less likely to live
alone or with a spouse. Instead, they were more likely to live with theirchildren or with others.
By economic regions, in Table 5a, three out of four odds ratios
for the northern regions, and all odds ratios for the southern regions are
statistically significant, but those of the north are smaller than unity,
while those of the south are greater than unity. The same findings hold in
Table 5b, but to a lesser degree of significance. These results imply thatthe northern elderly might be more likely than the central elderly to live
alone or with a spouse, while the southern elderly were less likely thanthe central elderly to live alone or with a spouse. It is difficult to explainthese findings, but burgeoning domestic and international migration andthe strong development of the industrial and service sectors in the south
could be contributing factors to the situation.
In terms of employment, in Table 5a, all the odds ratios for thevariable representing the elderly working in agriculture-related activities
are statistically significant, while only some of the odds ratios for thevariables representing the elderly involved in paid work or self-employment
are statistically significant. This generally means that the elderly working
in the agriculture sector were more likely to live alone or with a spousethan were other elderly people who were not working. The estimatedresults in Table 5b, however, did not show concrete conclusions for thedifferences between the elderly living with others and those living alone
or with a spouse.
Most of the odds ratios for the expenditure quintiles in Table 5a,
except the one for quintile 2 in the survey for 2002, are smaller than unityand statistically significant. This means that the elderly living in householdswith higher per-capita real expenditures were more likely to live alone orwith a spouse than to live with their children. Regarding this variable, the172

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Patterns and Determinants of Living Arrangements of the Elderly in Vietnam

estimated results to compare the elderly living with others and thoseliving alone or with a spouse show that these elderly groups were notsignificantly different.
All the odds ratios for the variable representing home ownershipin both Tables 5a and 5b are smaller than unity, and statistically significant
at the 1 percent significance level. This implies that the elderly people
who owned their current house were more likely to live alone or with aspouse. Housing plays an important role for the elderly in the decision onliving arrangements.

5. Concluding Remarks
Undergoing rapid social and economic changes, an aging society
produces a potential concern for public policy, particularly the welfare
policies for the elderly. By using data from the Vietnam Living Standards
Surveys (VLSS) in 1992/93 and 1997/98 and the Vietnam Household
Living Standards Surveys (VHLSS) in 2002 and 2004, we examined thepatterns and the determinants of the living arrangements of the elderlyin Vietnam, paying attention to various individual and household
characteristics of the elderly, including age, educational attainment,
gender, marital status, areas and regions of residence, employment,
expenditure, and home ownership. We applied multinomial analysis
techniques for the research objectives.
We found that, despite swift social and economic changes, living
arrangements of the elderly families have generally been maintained in
Vietnam: there was a high proportion of elderly people still living with
their children. However, this proportion has decreased gradually overtime, and it was compensated by an increase in the proportion of the elderly
living alone or with a spouse. The multinomial analyses show that theelderly at more advanced ages were more likely to live alone or with aspouse, and less likely to live with their children. While this could be anindicator that increased wealth or assets has led to greater independence
for the elderly, we have reason for concern because elderly people living
alone or with a spouse also tended to work less and live in rural locations,173

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Giang Thanh Long and Wade Donald Pfau

which could make them vulnerable to hardships.
Educational levels of the elderly and per-capita real expenditureof the elderly households have improved over the past decade. Moreover,the majority of the working elderly were found to be living with theirchildren. In this sense, the elderly in these households could be considered
as independents rather than dependents. A worrisome trend, however, isthe increasing proportion of elderly people living alone or with a spouse,
as well as the elderly living with others (but no children). This trend
implies that the elderly were probably left behind due to the exodus ofyoung people from rural to urban areas, and from the north to the south.
This calls for more attention from the government in making social policies
to protect the elderly in such cases.
This paper provides a number of findings about living arrangementsof the elderly in Vietnam, as well as policy implications for the government.
However, it does have some limitations. We analyzed the determinants of
the living arrangements of the elderly by examining only the individual
and household characteristics of the elderly. Moreover, we did not distinguishbetween dependent and independent elderly people. Because their rolesin the household differ depending on this status, this difference shouldhave been taken into account. Other important factors, such as individual
characteristics of the elderly's spouses and children, also need to beconsidered. These shortcomings will be mitigated in subsequent research.
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