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RIEB, Kobe University Site Map Access 日本語 Home Research & Education Publications RIEB Discussion Paper Series (English) RIEB Discussion Paper Series No.2015-01 RIEB Discussion Paper Series No.2015-01 Title Does Non-Farm Sector Employment Reduce Rural Poverty and Vulnerability? Evidence from Vietnam and India Abstract The present study examines whether rural non-farm employment has any poverty and/or vulnerability-reducing effect in Vietnam and India. To take account of sample selection bias associated with it, we have applied treatment-effects model. It is found that log per capita consumption or log mean per capita expenditure significantly increased as a result of access to the rural non-farm employment in both Vietnam and India - which is consistent with its poverty reducing role of accessing - with the aggregate effect larger in Vietnam than in India. Access to the rural non-farm employment significantly reduces vulnerability too in both countries, implying that diversification of household activities into non-farm sector would reduce such risks. When we disaggregate non-farm sector employment by its type, we find that poverty and vulnerability reducing effects are much larger for sales, professionals, and clerks than for unskilled or manual employment in both countries. However, because even unskilled or manual non-farm employment significantly reduces poverty and vulnerability in India and poverty in some years in Vietnam, this has considerable policy significance as the rural poor do not have easy access to skilled non-farm employment. Keywords Poverty, Vulnerability, Non-farm sector, Treatment Effects Model, Vietnam, India JEL Classification C21, C31, I32, O15 Inquiries Katsushi S. IMAI School of Social Sciences, University of Manchester, UK and Research Institute for Economics and Business Administration Kobe University Rokkodai-cho, Nada-ku, Kobe 657-8501 Japan Phone: +81-78-803-7036 FAX: +81-78-803-7059 Raghav GAIHA Faculty of Management Studies, University of Delhi, India Ganesh THAPA International Fund for Agricultural Development, Rome, Italy About RIEB Faculty Seminars at RIEB Research & Education Sections Kobe University Site Policy Site Map Access Contact Us Copyright©1996-2018 Research Institute for Economics and Business Administration, Kobe University. All Rights Reserved.