The authors begin with a review of past approaches to the economic analysis of ethnic disparities then describe the household-level data set used for the analysis in this paper. They highlight the determinants of living standards and how they differ between the groups. The authors then illustrate the econometric specification and discuss the results of their analysis.
More specifically, the authors argue that Vietnam’s ethnic minorities tend to be concentrated in distant rural areas and typically have lower living standards than the ethnic majority. They investigate how much this is due to poor economic characteristics versus low returns to characteristics and attempt to discover if there is a self-reinforcing culture of poverty in the minority group that reflects patterns of past discrimination.
The authors find that:
differences in income to prolific characteristics are an important explanation for ethnic inequality
ethnic inequality is most pronounced in areas where both groups inhabit
the model of income in the majority will be a poor guide to how to fight poverty among ethnic minority groups
there is evidence of compensating behavior on the part of the minorities.
The authors finally conclude that it is not enough to target poor areas to restore ethnic inequality. Policies will need to reach minority households within poor areas and to clearly distinguish behavioral patterns that helped the minorities well in the short term, but intensify ethnic differentials in the longer term.
The relationship between important determinants of life satisfaction and reported life satisfaction at the individual level is robust to alternative formulations and scales of the life satisfaction question
By Cojocaru, A. and Diagne, M., 2013
Produced by: World Bank Institute, World Bank (WBI)
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