MINISTRY OF EDUCATION MINISTRY OF PLANNING AND TRAINING AND INVESTMENT 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 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 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 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 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 to disaggregate 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, 10 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 and et 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) about Burkina Faso all 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 18 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 Literature review shows that GI in education and employment can negatively impact on HD through five mechanisms First, limiting the opportunity that family members can support one another in learning Second, restricting achievement in health care due to lower mother's education as compared to father's Third, restricting father's direct support to children due to family labor division in the way that assure mother's specialization in family care Fourth, hampering achievement of family health care and education for children due to lower women's negotiation and decision-making power Fifth, increasing fertility rate due to lower opportunity cost of child bearing and raising, thus increase dependence rate, decreasing investment in education and health care for each family member 19 2.3.2 Methodology for assessing impact of GI in education and employment on human development 2.3.2.1 Macro analysis Macro analysis is done with province being the unit of analysis and the correlation between gender-related development index (GDI) and human development index (HDI) with crosssection data in 2012 2.3.2.2 Micro analysis (1) Theoretical model Based on the models for assessing the impact of GI developed by Hill and King (1995), Dollar and Gatti (1999), Klasen (1999, 2002), WB (2001), Klasen and Lamanna (2009) and Maiga (2011) (2) Empirical model Model for assessing the impact of GI in education: Yi = α0 + λ1EDU_Fi +λ2EDU_Mi + αHHi + βCMi + ei (1) Model for assessing the impact of GI in employment: Yi = α0 + + λ1Emp_Fi +λ2Emp_Mi + αHHi + βCMi + ei (2) in which: Y is the dependence variable showing one aspect in human development, ei is the residual, being assumed to be normally distributed; EDU_F, EDU_M, Emp_F and Emp_M are main explanatory variables denoting female and male education and employment; vector HH shows family characteristics; vector CM shows characteristics of the commune where respective families reside (3) Variables Dependence variables represent: education for children, family health care Variable denoting GI is incorporated in the model indirectly through data disaggregated by sex Dummy 20 variable denoting household head's sex (Head_gender) and other controlled variables are also used 2.4 Factors affecting GI or the extent of impact of GI 2.4.1 Qualitative analysis (1) For GI in all aspects: institution environment; development level, culture and religion; (2) For GI in education: parents' education, girls' and women's opportunity costs of going to school, learning environment; (3) For GI in employment: labor division/roles by sex in family, education level of employees, discrimination by statistical errors 2.4.2 Quantitative analysis Blinder - Oaxaca decomposition are widely used for analyzing labor market and also for factors relating to severity and extent of impact of GI in education The basic principles comprises of two steps: step 1, estimating and testing whether there is really a gap in pay or number of schooling or not; step 2, decomposing factors contributing to the total gender gaps CHAPTER ASSESSING THE FACTUAL SITUATION OF GENDER INEQUALITY AND ITS IMPACT ON DEVELOPMENT IN VIETNAM 3.1 Overview of gender inequality in Vietnam 3.1.1 Factual situation of GI in education During 2004-2012, in all regions, female's literature rate is usually lower than men's, especially men usually have more opportunity to have professional knowledge Among labor with professional knowledge, in "vocational training" and "university training", the number of male students outweigh female peers, 21 except for "vocational high school" and "college", where female students are more than male peers In conclusion, with regard to primary (essential education) and tertiary education, women experience unfavorable bias bias Unbalanced ratio of male and female learners in "vocational training" and "college" show professional segmentation by sex 3.1.2 Factual situation of GI in employment Nationwide, the ratio of female laborers have not varied much and stand at 48.5% Female laborers usually work in the industries with less requirements skills or professional knowledge such as agriculture, or less sophisticated jobs as sale clerks, home maid On the contrary, male laborers are more likely to take jobs in industries with higher requirements for professional knowledge, holding managements positions, state management posts On average, female laborers' monthly salaries are about 75% (for employed groups) or about 83% male laborers' (for all groups) Among group with low professional knowledge, pay gap is larger With regard to economic sector, the largest and increasing pay gap is existing in the FDI enterprises, the private and state-own sectors are having progress, the smaller business and collective units showing pay gaps that need improvements 3.2 Overview of development level in Vietnam 3.2.1 Economic growth The Government has put forward solutions for getting rid of difficulties in doing business, supporting markets; stabilizing macro economic environment and determination for economic restructuring However, the achievements are still inconsiderable so EG is always an essential objective 22 3.2.2 Human development Vietnam's HDI is now decreasing, though at power pace According to UNDP, Vietnam's HDI is medium and ranks 121st among ranked 187 nations Almost nations in Asia have better ranks than Vietnam with regard to HDI Although the achievement in EG is considerable, the average per capita income still lies in lower middle income, making HDI low in comparison with many other countries Thus, the low HDI in Vietnam can be attributed mainly to low income 3.3 Impact of GI in education and employment on EG in Vietnam 3.3.1 Macro analysis Regression result is as follows: lnGDP = 1,58 + 0,299lnInv + 0,591lnEmp + 0,062lnTrd + 0,059 GDI The coefficients of the independent variables are significant and confirm that gender development (meaning lower gender inequality) has positive effects on EG; when GDI increases by percent, GDP increases by 0.059% This means GI hampers EG 3.3.2 Micro analysis Micro analysis is done through the comparison of capability of making incomes by female- and male-headed households Table 3.15 Average income per capita by household head sex Unit: thousand dong Marital 2010 Female Male 2012 All Female Male All 23 Married 2.414 1.571 1.684 2.889 2.134 2.229 Source: Author's calculation using VHLSS 2010-2012 In the same marital status (married), female household heads have higher comparability to earn income compared to male heads So, hypotheses H1 and H2 mentioned in Section 1.2.3 are accepted 3.4 Impact of GI in education and employment on HD in Vietnam 3.4.1 Macro analysis Macro analysis of the impact of GI on HD is done with province being unit of analysis through correlation of GDI and HDI với using cross-province data Extremely high correlation coefficient (being 0.9993 in 2012) leads to a conclusion that when gender inequality is low (meaning when GDI is high), the achievement in HD is high 3.4.2 Micro analysis 3.4.2.1 Impact of GI in education on HD Table 3.17 shows the results of regression of the impact of father's and mother's education on children's education and health care in family with married spouses This shows GI in education negatively affect both children's education and family health care Table 3.17 Results of regression of the impact of father's and mother's education on children's education and family health care Model Variables EDU_M (1) (2) (3) (4) (5) EDU_Proper EDU_6_18 EDU_expend NVacin HEALTH_Treat 0,011*** 0,005*** 0,002*** -0,000*** 0,011*** 24 EDU_F 0,010*** 0,025*** 0,007*** 0,003*** -0,018*** Constant 0,678*** 0,591*** 0,050*** 0,156*** 3,061*** *** p[...]... 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 13 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. .. residence region CHAPTER 4 SOLUTIONS TO SOLVE GENDER INEQUALITY AND ITS IMPACT IN ORDER TO PROMOTE DEVELOPMENT IN VIETNAM 4.1 Relevant context relating to the goal of gender equality and development promotion in Vietnam Deeper integration into the World Economy has impact on Vietnam' s development path and progress toward the goal of gender equality through exchanges, international cooperation, opportunities... while they take incomegenerating jobs; (2) Carrying out propaganda, encouraging and then institutionalizing part-time jobs for women CONCLUSIONS New contributions of the thesis By analyzing of factual situation of GI, its impacts and the factors affecting GI in education and employment, the thesis has achieved the research objective set forth in the beginning and also made theoretical and empirical contributions... FACTUAL SITUATION OF GENDER INEQUALITY AND ITS IMPACT ON DEVELOPMENT IN VIETNAM 3.1 Overview of gender inequality in Vietnam 3.1.1 Factual situation of GI in education During 2004-2012, in all regions, female's literature rate is usually lower than men's, especially men usually have more opportunity to have professional knowledge Among labor with professional knowledge, in "vocational training" and "university... number of findings relating to the case of Vietnam: (1) Brief assess of GI in education and employment; (2) Assessing the impact of GI in education and employment on EG and HD; (3) Pointing out factors affecting severity and impact of GI in education and employment using both qualitative and quantitative methodologies; (4) Making recommendations on solutions relating to GI in order to promote development. .. toward gender equality 2011-2020 4.2 Principle and goal of solving GI in order to promote development in Vietnam Solutions to be applied must meet the following principles and criteria: directly intervene in narrowing the gender gaps and/or mitigate the impact of GI in education and employment on EG and HD; be based on the national direction, strategies and priority in development and national gender. .. 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 - Oaxaca 14 decomposition and qualitative reasoning (Chapter 3) Basing on the findings, the recommendation... 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 by Klasen 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... affecting GI in each locality 31 LIST OF RELATED RESEARCH WORKS AND PUBLICATIONS BY THE AUTHOR 1 Luong Thi Ngoc Oanh (2015), Experiences of gender inequality reduction in employment in Finland, Economy and Forcast Review No 24 (Ministry of Planning and Investment), pp.58-60, Hanoi 2 Luong Thi Ngoc Oanh (2015), Impact of gender inequality in education on human development, Vietnam Trade and Industry... cross-province data Extremely high correlation coefficient (being 0.9993 in 2012) leads to a conclusion that when gender inequality is low (meaning when GDI is high), the achievement in HD is high 3.4.2 Micro analysis 3.4.2.1 Impact of GI in education on HD Table 3.17 shows the results of regression of the impact of father's and mother's education on children's education and health care in family with