Trade liberalization, labor allocation and income dynamics in Vietnam Hoang Dat Vu To cite this version: Hoang Dat Vu. Trade liberalization, labor allocation and income dynamics in Vietnam. Economics and Finance. Université Paris sciences et lettres, 2018. English. NNT : 2018PSLED050. tel-02086452 HAL Id: tel-02086452 https://tel.archives-ouvertes.fr/tel-02086452 Submitted on 1 Apr 2019 HAL is a multi-disciplinary open access L’archive ouverte pluridisciplinaire HAL, est archive for the deposit and dissemination of sci- destinée au dépôt et à la diffusion de documents entific research documents, whether they are pub- scientifiques de niveau recherche, publiés ou non, lished or not. The documents may come from émanant des établissements d’enseignement et de teaching and research institutions in France or recherche français ou étrangers, des laboratoires abroad, or from public or private research centers. publics ou privés. THÈSE DE DOCTORAT de l’Université de recherche Paris Sciences et Lettres PSL Research University Préparée à l’Université Paris-Dauphine Trade liberalization, labor allocation and income dynamics in Vietnam École Doctorale de Dauphine — ED 543 Spécialité Sciences économiques COMPOSITION DU JURY : M. Jean-Pierre CLING INSEE Co-Directeur de thèse M. François ROUBAUD IRD, DIAL Directeur de thèse M. Cuong LE VAN CNRS Rapporteur M. Marc LAUTIER Université Rennes 2 Rapporteur Soutenue le 30.11.2018 M. Christophe GIRONDE par Vu Hoang Dat IHEID Membre du jury Mme Emmanuelle LAVALLEE Dirigée par Jean-Pierre Cling et Université Paris Dauphine Membre du jury François Roubaud M. Remco OOSTENDORP Vrije Universiteit Amsterdam Président du jury Trade liberalization, labor allocation and income dynamics in Vietnam THESE Pou lotetio du tite de Doteu e “iees Éooiues VU Hoang Dat Jury M. Jean-Pierre CLING, Institut National de la Statistique et des Etudes Directeur de these Economiques M. François ROUBAUD, Institut de Recherche pour le Développement, Directeur de these DIAL M. Cuong LE VAN, Centre National de la Recherche Scientifique Rapporteur M. Marc LAUTIER, Université Rennes 2 Rapporteur M. Christophe GIRONDE, Graduate Institute of International and Membre du jury Development Studies, Geneva Mme Emmanuelle LAVALLEE, Université Paris Dauphine Membre du jury M. Remco OOSTENDORP, Vrije Universiteit Amsterdam Présidente du jury 1 Table of Content List of Tables ............................................................................................................................................. 5 List of Figures ............................................................................................................................................ 6 List of Appendices ..................................................................................................................................... 7 Acknowledgement .............................................................................................................................9 General Introduction ........................................................................................................................ 10 Context and research needs ................................................................................................................... 10 Objectives of the thesis ........................................................................................................................... 14 Concepts and categorizations of employment ....................................................................................... 15 Data ......................................................................................................................................................... 18 Structure of the thesis ............................................................................................................................ 19 Main empirical results ............................................................................................................................ 20 References .............................................................................................................................................. 22 Chapter Struture Chages i Vieta’s Laor Market sie Doi Moi ............................................. 25 Introduction ............................................................................................................................................ 26 1. A theoretical background ................................................................................................................ 27 1.1. Underlying reasons and directions of structure change ......................................................... 27 1.2. Models of the informal sector and formal-informal dynamics ............................................... 29 1.2.1. Models of the informal sector ............................................................................................ 31 1.2.2. Interlinks between the sectors and their dynamics ............................................................ 33 2. Eistig eidee of stutual hage i Vietas lao aket ................................................ 34 3. Data and specifications ................................................................................................................... 41 4. “tutual hage i Vietas lao aket since 1993 ............................................................... 43 4.1. Population and Economic Growth of Vietnam since Doi moi ................................................. 43 4.1.1. Incremental of population and employment in Vietnam ................................................... 44 4.1.2. Economic growth ................................................................................................................ 45 2 4.2. Structural change in Vietnam labor market ............................................................................ 46 4.2.1. Economic and institutional sectors ..................................................................................... 46 4.2.2. Urbanization process .......................................................................................................... 54 4.3. Structural change within areas ............................................................................................... 56 4.3.1. Urban Hanoi and Ho Chi Minh ............................................................................................ 56 4.3.2. Rural Hanoi and Ho Chi Minh .............................................................................................. 57 4.3.3. Other urban areas ............................................................................................................... 58 4.3.4. Other rural areas ................................................................................................................. 59 4.4. Employment in household businesses .................................................................................... 60 4.5. Income dynamics .................................................................................................................... 62 4.5.1. Income dynamics of different types of employment ......................................................... 62 4.5.2. Income gaps across types of employment .......................................................................... 67 4.6. Labor productivity ................................................................................................................... 72 Conclusion ............................................................................................................................................... 76 References .............................................................................................................................................. 79 Chapter 2 Impacts of Minimum Wage on Employment and Wage Distribution in Vietnam ................. 86 Introduction ............................................................................................................................................ 87 1. Literature review ............................................................................................................................. 88 1.1. Theoretical predictions ........................................................................................................... 89 1.2. Empirical evidence .................................................................................................................. 90 2. Minimum wage context of Vietnam ............................................................................................... 94 3. Estimation models .......................................................................................................................... 97 3.1. Impact of the minimum wage on total employment and employment status ...................... 97 3.2. Impact of the minimum wage on wage distribution ............................................................ 102 3.3. Estimation strategies ............................................................................................................ 103 4. Data and Descriptive Analysis ....................................................................................................... 104 3 4.1. Data sources and data construction ..................................................................................... 104 4.2. Descriptive analysis ..............................................................................................................