Diep Phan
Ian Coxhead

A persistent public-private sector difference in returns to skills is one sign that Vietnam’s transition from command to market economy remains incomplete. Matching this is large gap in post-compulsory education enrollments favoring children from families with members employed by government or state enterprises. We compare that gap between 2004 and 2014, a decade during which Vietnam experienced a boom in private-sector and foreign-invested economic activity. Despite the boom, we find a persistent and widening enrollment gap between “state” and “nonstate” households which are similar in other observable respects. This institutional gap is not the only basis for enrollment differences—the ethnicity gap has also widened, even as rural-urban disparities have diminished—but they may contribute to slow and unequal progress in overall educational attainment. Unless addressed, enrollment gaps are likely to worsen intergenerational inequality and may reduce long-run economic growth.

Publication Type
Working Paper
File Description
First version, April 14, 2020
JEL Codes
I24: Education and Inequality
I25: Education and Economic Development
J24: Human Capital; Skills; Occupational Choice; Labor Productivity
O15: Economic Development: Human Resources; Human Development; Income Distribution; Migration
P23: Socialist Systems and Transitional Economies: Factor and Product Markets; Industry Studies; Population
developing countries
state-owned enterprises