Impacts of Vietnam’s new rural development policy on rural households’ income: empirical evidence from the Heckman selection model

ABSTRACT

The New Rural Development program (NRD) is among the top developmental policies of Vietnam’s government to cope with imperative issues in the rural regions, especially a widening income gap between the urban and rural regions. This paper is the first trial for studying on key social, economic, and natural conditions affecting communes’ adoption of the NRD and factors impacting on rural households’ income based on the NRD’s implementation criteria using a Heckman Selection model to substantiate the NRD’s performance of increasing rural households’ income. The estimation model signifies that the poverty rate has a negative impact on the NRD’s adoption in contrast to geographical aspects, average ages, and cooperative variables. At the outcome estimation, rural infrastructure development and technology transfer exert a strong influence on rural households’ earnings. This implies that promoting investments in infrastructure and technology transfer are crucial for rural development, especially with the income increase purposes.

KEYWORDS:

• Heckman selection model
• policy performance evaluation
• new rural development
• developmental policy
• Vietnam

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Notes on contributors

Manh Hung Do

Manh Hung Do is a researcher of the Institute of Policy and Strategy for Agriculture and Rural Development under the Ministry of Agriculture and Rural Development of Vietnam. His research interests include economic and sustainable development, green growth policy, rural development policy, agricultural policy, and local governance.

Sang Chul Park

Sang Chul Park is an Assistant Professor in the Department of Public Administration at Yeungnam University, Republic of Korea. His research interests include sustainable and urban development, health policy and management, local governance, and Official Development Assistance (ODA).