Luong Thi Ngoc Oanh

1

CENTRAL INSTITUTE FOR ECONOMIC MAMANGEMENT

LUONG THI NGOC OANH

THE IMPACT OF GENDER INEQUALITY ON DEVELOPMENT IN VIETNAM

Major: Development Economics

Code: 62 31 01 05

SUMMARY OF DOCTORAL THESIS OF ECONOMICS

Hanoi- 2016

1

Completed at: Central Institute for Economic Management

Scientific advisors: Dr. Nguyen Thi Tue Anh

Assoc. Prof. Dr. Chu Tien Quang

Examiner 1: Dotor Dao Quang Vinh

Examiner 2: Associate Professor, Doctor Bui Tat Thang

Examiner 3: Associate Professor, Doctor Le Xuan Ba

This thesis shall be defended before Institute-level Thesis Examination Council of Central Institute for Economic Management at ….. on …………………….. 2016

Can be looked up at libraries of:

- Central Institute for Economic Management, Hanoi

-National Library, Hanoi

INTRODUCTION

1. The relevance of the research topic

Gender equality is one of the eight Millennium Development Goal, and also one of a country's societal development and has inspired interests of academic circle. Dollar and Gatti (1999), ), Klasen (2002), Klasen and Lamanna (2009), Abu-Ghaida and Klasen (2004) have justified negative impacts of gender inequality on development. However, a number of other research works found controversial conclusions, such as the one by Seguino (2000) and that by Schober and Winer-Ebmer (2011). Besides, Bandiera and Natraj (2013) confirm that findings in research works done with case study of one or a number of countries can hardly hold true for others, so research should be done for each country when development policies for that country are about to made.

The Communist Party, the Prime Minister and the National Committee for the Advancement of Women in Vietnam have put emphasis on the goal of gender equality and put forward relevant policies, strategies and regulations. However, Vietnamese women are still discriminated against in such aspects as employment, health, social recognition... Thus, research to work out solutions relating to gender inequality in order to boost development in Vietnam is very important.

2. Purpose, significance of the thesis

2.1 Purpose

Due to the fact that progress toward the aim of gender equality is not remarkable although there have been interventions to reduce gender inequality, the thesis is done with the main purpose of assessing the factual situation, its impacts in order to make recommendations to promote development in Vietnam. The topic "The impact of gender inequality on development in Vietnam" has been chosen as the thesis theme.

As gender inequality is signifying in a number of aspects and the meaning of development is quite broad, the thesis confined its research in two aspects: education and employment for gender inequality (GI)) and economic growth (EG) and human development (HD) for development. The thesis can become reference for development policy-makers in Vietnam.

2.2 Significance

The thesis will make both theoretical contribution and empirical evidence regarding the impact of gender inequality on economic growth and human development with a specific case of Vietnam.

2.2.1 Theoretical contribution

The thesis will make contribution with regard to methodology of assessing the factual situation, analyzing the impact and influential factors of gender inequality in order to be theoretical reference to future research.

2.2.2 Empirical contribution

Based on the analysis and assessment of Vietnam, the thesis also make policy recommendations relating to gender inequality in order to boost development and to be of reference to development policy makers.

CHAPTER 1. LITERATURE REVIEW AND RESEARCH PLAN

1.1 Literature review relating to impact of gender inequality on development

1.1.1 Theoretical research works on the impact of GE on development

1.1.1.1 The impact of GI on economic growth

Barro and Lee, Dollar and Gatti, Klasen and Lamanna, Braustein have done research based on the Neoclassical EG model - Solow model- to identify the impact of GI on factors directly or indirectly contributing to EG.

(1) The impact of GI in education on economic growth

Klasen and Lamanna (2009), Ferrant (2011), Seguino (2000) have confirmed that GI will hinder EG by reducing human capital, marginal utility of education, discouraging investment, limiting the opportunity to take advantage of "golden population stage", limiting the chance to utilize relatively cheaper female labor in order to improve competitiveness in the world economy and hence hampering EG.

(2) The impact of GI in employment on economic growth

Klasen and Lamanna (2009), David and Teignier-Baque (2012), Seguino (2000), WB (2001)have come to a conclusion that gender inequality in employment is inefficient and make distortion in the economy in a similar manner to gender inequality in education due to higher fertility rate, little chance to utilize relatively cheaper female labor for improving competitiveness, discouraging investment in long-term human development,possibility of corruption and thus making the economy work less efficiently.

1.1.1.2 The impact of GI on human development

Theories in this theme usually originated from microeconomic theories on labor division between husband and wife; on the right to allocate family income and on gender differences in spending and investment behaviors.

(1) The impact of GI in education on human development

Klasen (2002) has proved that education for mothers have positive impacts on education for children through direct supports or creation of favorable study environment; when siblings or spouses in one family have equivalent education levels, they can make mutual supports for one another. Hill and King (1995) have also confirmed that mothers' education have greater impact on children's education than fathers'; there are four channels through which female education can positively affect family health care.These conclusions mean that GI in education negatively affects family health care. Moreover, Klasen (1999) and Mikkola (2005) believed that once GI in education is less severe and women have greater knowledge and thus, can be employed, female's opportunity costs of bearing and raising children become higher, the fertility rate will be lower, the resources devoted for each child will be greater, children's health care and education condition will be improved or their budget portion for education and health care will increase. This means GI in employment will have negative impact on HD.

(2) The impact of GI in employment on human development

Lundberg and Pollak (1996) conclude that who earn family income will have decision-making power and that husband and wife have different ways of allocating income between different uses. Ferrant (2011) and Thomas and Strauss (1997) believe that GI in employment adversely affect HD as when women have no decision -making power regarding family spending, the efficiency of family expenditure will become lower as male usually spend less for education for children and health care.

1.1.2 Empirical research on impact of GI on development

1.1.2.1 Empirical research for group of countries

(1)Impact of GI on economic growth

As it is difficult todisaggregate the impact of GI in each education and employment in empirical research and empirical research works usually evaluate GI in a number of aspects, following is the review of empirical research in both dimensions. The widely used methodology applied in finding out about causational relationship between GI and EG is to take correlation coefficients or regression with cross section, time series or panel data. Dependent variables are usually GDP or GNP, growth rate per capita income or total factor productivity; independent variables include those in Neoclassical model such as: capital or investment, labor force or human capital, openness or trade volume and variables representing GI.

Barro and Lee (1994), Dollar and Gatti (1999), Klasen (2002), Klasen and Lamana (2009), Schober and Winter- Ebmer (2011) have analyzed groups of countries and concluded that GI in employment or income have negative impacts on EG. However, Seguino (2000) hold that GI in pay with lower salary for female employees can help labor-intensive export industries improve their competitiveness by taking advantage of lower labor cost and hence back up economic growth.

Martin and Garvi (2009) has done a research into the case of Spain and confirms that EG, gender development and HD are positively correlated for groups of provinces with very high or very low development level.Pervaiz andet al (2011) has analyzed EG in Pakistan and comes to a conclusion that GI has negative impacts on EG in the long-term.Tansel, A. et al (2012) have investigated EG of Turkey by applying Cobb-Douglas with the disaggregation of male and female education variables and confirms that GI has significantly and negatively impacted on labor productivity.

(2) The impact of GI on HD

Methodologically, empirical research is based on regression or correlation based on cross-section or panel data with provinces and countries serving as unit of analysis.

A research about a group of nations by Hill and King (1995), findings by Mikkola (2005) about Finland, by Maiga (2011) aboutBurkina Fasoall confirm negative impact of GI in education on HD in both short- and long-term.

Mikkola (2005) points out that when there is a transfer of decision-making power from a husband to a wife the percentage of family budget spent for children increases. Similarly, a research work by Morrison et al (2007) also affirms a conclusion that female household head devote more family resources for kids. This means GI has negative impact on HD.

1.1.2.2 Research on Vietnam

WB (2008) affirms a conclusion that the acknowledgement of both husband's and wife's on land use right certificate can increase investment opportunities and improve the livelihood for old age women.A research work by Duvvury, N., Carney, P. and Dr. Nguyen Huu Minh (2012) gives an estimate that the total opportunity cost of domestic violence can be approximately 1.41% of Vietnam's GDP in 2010,which is equivalent to 2,536,000 bn.

Moreover, there is research project leaded by Dr. Nguyen Thi Nguyet (CIEM) which has pointed put factors affecting GI in income in Vietnam and has made a number of relevant recommendations. Research works by Lee, S. (2008); Rodger & Menon (2010); WB (2011), Nguyen Viet Cuong(2012) have investigated factual status of GI in Vietnam but have not evaluated the impact of GI or causes of GI. Relating to gender stereotype and causes of GI there is pieces of work by Wendy N. Duong (2001),UNFPA (2013). Besides, a doctoral thesis by Nguyen Quynh Hoa has investigated the factual situation and factors associated with gender equality in access to productive land in Vietnam.

1.1.3 Contributions and unsolved issues in reviewed literature

1.1.3.1 Contributions

Theoretically, previous research works have pointed out aspects having signals of GI, measures of GI and suggested some models for assessing the impact of GI on development.

Empirically, previous research works have shown aspects having signals of GI, causes of GI, models of EG and development with incorporating gender aspect; pointed out technical mistakes of quantitative analysis.

1.1.3.2 Unsolved issues

Previous research works are mainly done for groups of countries and the research into impact of GI on development in Vietnam is still kept open.

1.2 Tentative research plan

1.2.1 Research objective

The overall objective is to investigate the impact of GI in education and employment on EG and HD in order to work out some solutions relating to GI and its impacts to promote Vietnam's development.

1.2.2 Research object and scope

1.2.2.1 Research object

Research object of the thesis is the impact of GI on development in Vietnam.

1.2.2.2 Research scope

(1) content scope

Relating to GI, the thesis covers GI in education and employment. Relating to development, the thesis limit to two major pillars of development: EG and HD.

(2)Geographical scope

The time scope of the thesis is Vietnam

(3) Time scope

Based on the availability of data up to June, 2015, the thesis has time scope 2000-2012 period.

1.2.3 Thesis contribution: research questions and hypotheses

1.2.1.1 Research questions

Based on the issues unsolved by previous research, the thesis focus on the analysis of the impact of GI in education and employment on two main aspects of development: EG and HD, finding answers to the following questions

(1)What is the factual situation of GI in education and employment in Vietnam?

(2) What are the impacts of GI in education and employment on EG and HD in Vietnam?

(3)Which factors affecting GI in education and employment? What policies concerning GI should be put forward and applied in order to promote development in Vietnam?

1.2.1.2 Research hypotheses

Based on literature review and the research scope (in 1.1.2 - Chapter 1), the second research question concerns the following hypotheses:

H1: GI in education has negative impact on EG

H2: GI in employment has negative impact on EG

H3: GI in education has negative impact on education for the next generation

H4: GI in education has negative impact on family health care

H5: GI in employment has negative impact on education for the next generation

H6: GI in employment has negative impact on family health care

1.2.4 Research approach and research methodology

1.2.4.1 Research approach

Based on literature review(Chapter 1),the thesis adapt theoretical framework and methodology to evaluate the impact of GI (Chapter 2). Then, the thesis analyze the factual situation, assess the impact and the factors affecting GI in education and employment through regression, correlation, Blinder -Oaxacadecomposition and qualitative reasoning(Chapter 3). Basing on the findings, the recommendation with regard to development promotion in Vietnam in the future will be made.(Chapter 4).

(1) Macro approach

Macro approach is utilized to assess the impact of GI on EG and HD with provinces as observation and analysis unit

(2) Micro approach

Micro approach with individual or household as unit of observation and analysis will be used for assessing the impact of GI on EG and HD using data from VHLSS 2010-12.

1.2.4.2 Ideological methodology

The thesis employs such reasoning methodologies as: dialectic reasoning, induction and intuition, synthesizing and analysis, generalization.

1.2.4.3 Data analysis method

The thesislargely utilize quantitative methods such as regression, descriptive analysis, correlation using cross-section or panel data, Blinder-Oaxaca decomposition and qualitative analysis.

1.2.4.4 Data source

Data to be used are mainly secondary data extracted from the series of household living standard surveys (VHLSS - GSO),labor force surveys, (LFS- MOLISA), Provincial socio-economic data (Provincial Departments of Statistics), data released by WB, UNDP…

CHAPTER 2. THEORETICAL FRAMEWORK AND METHODS TO ANALYSE THE IMPACT OF GENDER INEQUALITY ON DEVELOPMENT

2.1 Fundamental concepts

2.1.1 Gender and gender inequality

2.1.1.1 Gender

Gender refers to the role and expectations relating to men and women and assigned by society.

2.1.1.2 Gender inequality

a. Concept

Gender inequality refers to any gap or difference in rights, opportunity and benefits belonging to men and women or any discriminations against men and women.

b. Measurements

Composition measurements include GDI and GEM, with value ranging from 0 to 1, the closer the value to 1, the lower the degree of gender inequality.

2.1.2 Development

Development is a broad concept, in which EG, structural change and human development are main components.

2.1.2.1 Economic growth (EG)

Economic growth is an increase in the gross domestic products, gross national products or per capita income. Economic growth measurement widely used is growth rate of GDP.

2.1.2.2 Human development (HD)

According to UNDP, "human development is a procees of expanding human being's choices, in which the most importatnt choices are assuring a long, healthy lifewith adequate education...". HDI is used to measure a nation's progress in human development.

2.2 Theories and methodology to assess the impact of gender inequality in education and employment on economic growth

2.2.1 Theories relating to the impact of gender inequality in education and employment on EG

2.2.1.1 Theories relating to the impact of GI in education on EG

The thesis employs theories and models developed byKlasen and Seguino.

GI in education existing now is mostly bias against women: less women are having opportunity to go to school or having less number of schooling. This hamper EG in four following ways.

First, limiting the average connate talents of educated kids (regardless boys or girls) and thus limiting the economy's average human capital.

Second, limiting the marginal economic benefit of education (according to diminishing marginal economic benefits). Third, restricting the opportunity to intensively utilize female labor with relatively lower pay in export-oriented labor-intensive industries. Fourth, limiting the chance to take advantage of positive externality of gender equality such as: low fertility rate, restricting the chance of mutual supports in learning among family members, lower dependence ratio, increased savings and investment, higher capital/labor ratio, and improved human capital.

2.2.1.2 Theories relating to the impact of GI in employment on EG

The thesis bases on the theoretical framework employed by Seguino (2000), Klasen (2002, 2004, Klasen and Lamanna (2009). GI in employment hamper EG in four manners. First, reducing the average capability of labor force, leading to lower-than- possible labor productivity, decreasing ability to innovate and manage efficiently. Second, increasing fertility rate by reducing opportunity costs of child bearing and raising, thus leading to higher rate of dependence, lower savings and investment, lower capital/labor. Third, limiting the opportunity for intensive use of relatively cheaper female labor, hence reducing the competitiveness of export-oriented industries. Fourth, restricting women's negotiation and decision-making power in family, thus, reducing percentage of family budget spent on education and health care, or cutting down on investment for long-term human capital development.

2.2.2 Methodology for assessing GI in education on EG

2.2.2.1 Macro analysis

(1) Model

Based on Neoclassical EG and theoretical framework developed by Seguino (2000), Klasen and Lamanna (2009), Schober and Winter-Webmer (2011), Pervaiz et al (2011):

GDP = f (K, L, H, Openness, GIi)

Dependent variable: GDP; Independent variables: investment, labor, openness, variable representing GI is added.

(2) Estimation method

The thesis utilizes Ordinary Least Square(OLS).

(3) Unit of analysis

Unit of analysis is province and GDI is a proxy for GI

2.2.2.2 Micro analysis

(1) Fundamental assumptions

When comparing male's and female's ability to earn incomes by comparing the average member income in male- and female-headed households, the thesis assumes that household head is the family income-earner and decision-maker in the family.

(2)Data source and estimation method

Statistics and tests of estimators of average incomes in two type of families are based on VHLSS 2010 and 2012.

2.3 Theories and methodology to assess impact of gender inequality in education and employment on human development

2.3.1 Theories relating to impact of GI in education and employment on human development