Interrelation between livelihood assets and poverty in rural Vietnam

Abstract

Multi-dimensional poverty approach is currently employed in research worldwide instead of the conventional monetary-based poverty one. The Sustainable Livelihoods Approach is closely related to multi-dimensional poverty concept in terms of using a complex set of socioeconomic indicators to reflect the accessibility to five livelihood assets of household or individual, that is, the human, social, natural, physical and financial assets. This study aims at exploring interrelations between monetary poverty and other socioeconomic characteristics of rural households in Vietnam relying on livelihood approach and searching relevant socioeconomic indicators for multi-dimensional poverty measurement. Various multivariate analysis methods as Principal Component Analysis, Multiple Correspondence Analysis and Cluster Analysis are applied. Data of 6,837 rural households extracted from VHLSS 2008 dataset are used in this study. The results confirm that multi-dimensional poverty of rural household is explained by at least ten dimensions representative of four livelihood assets. Several continuous and categorical variables are extracted as relevant indicators for multi-dimensional poverty measurement. Household classification by multi-dimensional poverty is likely more statistically efficient when homogeneity with group is improved in comparison to basing on expenditure per capita.