# 3.1. Socio-economic characteristics

The data used in the analysis come from the 1992/93 and 1998 rounds of Vietnam's Living Standards Surveys (VLSS) which included 4,800 and 6,000 households, respectively. The survey was conducted by Vietnam's General Statistical Office and the sample stratified into 7 administrative<sup>areaswhich wegroup</sup> into four major regions. Our analysis focuses on the 2825 households included in the rural panel of<sup>the</sup> VLSS who were interviewed in both 1992/3 and 1998. Table I reports descriptive statistics for the whole country in 1993 and 1998 and the four main regions in 1998.6 We note that the size of an<sup>average</sup> household ranged from 4 to 5 persons, about 3 in the 14 to 60 age category and 0.5 above 60, and the<sup>age</sup> of household heads about 44 in 1993. About 20% of households, ranging from 17% to 30% depending<sup>on</sup> the region, were headed by a female. Levels of formal education increased considerably, from 4 years in 1993 to 6.8 years in 1998. About 10% of households experienced loss of one or more adult family members during the 1993 to 1997 period.!

Survey results point towards an average annual increase of per capita expenditure<sup>of 5.9%over the1993-</sup> 1998 period, from 1.69 Mn. Dong to 2.26 Mn. Dong. While per capita income in<sup>1998isalmost equalto</sup> per capita expenditure, the large gap between the two in 1993 is likely to be attributable to measurement error, i.e. underreporting of income in the first period. Despite this increase, and a highly egalitarian distribution of per capita expenditure, which is characterized by a Gini coefficient of 0.26, the rural economy is still quite poor, with per capita income amounting to between US$153.46 (in the Northern Uplands) to US$ 245.45 (in the South).

The rapid pace of off-farm development is illustrated by the marked increase in migration visible<sup>in table</sup> 1. While the share of household heads who had migration experience increased from 11% in 1993 to<sup>15%</sup> in 1998, the next generation seems to have benefited most from the increase in off-farm employment. The share of households who had at least one member with an off-farm job increased from 30% to 55% between the two periods and the incidence of migration by household members accelerated from 29% in 1993 to 64% in 1998. The level of migration differs across regions, with only<sup>56% of householdshaving</sup> a migrating member in the Red River Delta and North Central, as compared to 75% in the Southeast and Mekong Delta. However, the increase in the share of households who, since<sup>1993,havehadat leastone</sup> member migrate was fairly uniform across the four regions, implying that the variation observed is<sup>due to</sup> pre-existing differences rather than a differential evolution (and a failure of some regions to<sup>benefitfrom</sup> off-farm employment).

> 6 In the descriptive table and also for all the econometric regressions,<sup>wedividethe2824householdsinto4regionsbasedontheoriginal7</sup> administrative regions. Regionl include the 546 households from Northem<sup>Uplandsadministrativeregion.Region2includesthe1326</sup> households from Red River Delta and North Central. Region 3 includes<sup>the 298 householdsfrom originalCentralCoastregion.Finally Region 4</sup> includes the 650 households from Southeast region and Mekong River Delta region.

> 7 We focus on adults, defined as being above the age of 13 years, because<sup>in thesecases, deathsimply theloss of a significant amountof family</sup> labor, the need to incur expenses for burials, and possibly also the necessity of distnbuting<sup>land holdings among heirs.Any of thesewill seriously</sup> reduce the household's productive capacity.

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