Trade Liberalisation and Poverty Dynamics in Vietnam

Trade Liberalisation and Poverty Dynamics in Vietnam

This paper explores the poverty impact of Vietnam`s trade liberalisation over the 1990s and asks how well they could have been predicted from prior data. We identify policy changes and their major effects on trade and prices. We then seek the effects of these changes in a panel comprising 4,302 households observed in 1993 and 1998. Using a multinomial logit model, we find evidence that trade liberalisation influenced household poverty status and that considering trade effects would help to identify winners and losers a priori. We also find evidence that trade liberalisation reduced poverty substantially over the period 1993-1998.