Publication Type

Journal Article

Version

publishedVersion

Publication Date

6-2010

Abstract

There was a significant and widening rural-urban gap during the economic boom in Vietnam in the 1990s. Using an econometric decomposition, we find that differences in individual characteristics such as education, ethnicity and age are the primary explanation for this widening gap, whereas differences in the returns to these characteristics are the primary explanation for the increase in the gap at higher percentiles. We then argue that government investment policies and the manipulation of price incentives were important factors behind the gap. In particular, we argue that government policies created some benefit to urban dwellers at the expense of rural areas, lending support to Lipton's urban-bias hypothesis, which states that government, under strong political pressure from the urban population, directs resources from rural to urban areas without consideration of efficiency or equity.

Keywords

rural-urban gap, urban-biased policy, Vietnam

Discipline

Asian Studies | Urban Studies

Research Areas

Applied Microeconomics

Publication

Asian Economic Journal

Volume

24

Issue

2

First Page

161

Last Page

178

ISSN

1351-3958

Identifier

10.1111/j.1467-8381.2010.02034.x

Publisher

Wiley: 24 months

Additional URL

http://doi.org/10.1111/j.1467-8381.2010.02034.x

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