The Determinants of Gender Income Inequality in Vietnam: A Longitudinal Data Analysis

ABSTRACT

Despite a great effort from the Vietnamese government, women in Vietnam have generally been at the disadvantaged position to access education and development opportunities. As a result, the wage gaps between men and women exist. This study is conducted to investigate the gender income inequality in Vietnam in the 2004–2016 period using data from Vietnam Household Living Standards Surveys (VHLSS). The results indicate that the gender pay gap in Vietnam has decreased during the research period. Empirical findings also indicate that education, ethnicity, economic sectors, and geographic areas are main determinants causing wage differentials in Vietnam. Additionally, the gender pay gap, with the focus on the so-called “Within inequality”, is heterogeneous across the wage distribution using unconditional quantile regression approach. In particular, the gender pay gap is shown to be higher at the top and the bottom quantiles of the wage distribution, indicating that inequality is more severe among low-paid and high-paid wage earners. These findings suggest that the government‘s policies should focus on encouraging education and improving the national economy creating more jobs for women to reduce gender wage gap in Vietnam.

KEY WORDS:

• gender’s wage gap
• unconditional quantile regression
• VHLSS
• Vietnam

JEL:

• J16
• J18
• I38

Notes

1. We apply as the following formula: $CompoundAnnualGrowthRate\left(CAGR\right)=\sqrt[n]{\frac{FV}{PV}}-1$$CompoundAnnualGrowthRate\left(CAGR\right)=\sqrt[n]{\frac{FV}{PV}}-1$.

2. A similar result is obtained when we employ the Heckman’s two-step consistent estimates, lending further support for this estimation.

Additional information

Funding

This work was supported by The National Foundation for Science and Technology Development of Vietnam [502.01-2018.38].