Income Diversity and Poverty Transitions: Evidence from Vietnam

Abstract

The large share of the population in rural areas of the developing world has been diversifying their livelihood to nonagricultural activities. However, the amount of the literature that discusses the possible effects of the diversity on a household's well‐being is still limited. This study contributes to this strand of the literature by investigating the effects of income diversity on poverty transitions. The analysis is based on household panel data collected in the 2000s from Vietnam and applied to a multinomial logit model. The results show that households with better access to markets are more able to diversify their income sources to nonagricultural activities and the diversity is helpful for a household to escape poverty or to avoid falling into poverty.

Is the coupling and coordination of economic, social and environmental development crucial to the governance of relative poverty?

“…For instance, Based on some official statistics and survey data, Guan Xinping analyzes China’s current poverty problem and some important aspects of anti-poverty social policies and proposes social policies to reduce poverty by expanding the coverage of benefits raising the level of protection, increasing its public investment [ 42 ]. Cuong Viet Nguyen proposes a poverty reduction strategy from a policy perspective by comparing the poverty rate and the income and expenditure of independent households in provinces and districts as reported by the government [ 43 ], and Van Q. Tran proposes that enhancing the diversity of income sources of farming households can effectively reduce poverty by investigating the impact of income diversity on the transformation of poverty [ 44 ]. Fan Gang has proposed that addressing relative poverty should focus on five major challenges, including institutional safeguards, industrial cultivation, capacity building, humanistic development, and psychological services.…”