Sectoral composition of growth and poverty reduction in Vietnam

Abstract

This paper examines the impact of the sectoral composition of growth on poverty reduction in Vietnam during the period 1998-2008. It is found that an increase in the proportion of the agricultural sector will lead to a higher poverty rate and that economic growth has a positive impact on poverty reduction in Vietnam. These results support our hypothesis that the sectoral structure of economic growth affects poverty independently from overall economic growth. Moreover, these results also demonstrate that the process of restructuring the economy towards reducing the roportion of agriculture and increasing the share of industry will have a positive impact on poverty reduction in the future.