Qual Quant (2014) 48:2175–2189
The role of villages in households’ poverty exit: evidence
from a multilevel model for rural Vietnam
Bruno Arpino · Arnstein Aassve
Published online: 6 June 2013
© Springer Science+Business Media Dordrecht 2013
Abstract Vietnam experienced a dramatic drop in overall poverty during the 90s. However,
the poverty reduction showed substantial variation across households, villages and regions.
Using a multilevel model on panel data from the rural sample of the Vietnam Living Standard
Measurement Survey we demonstrate the important role of villages in household poverty exit
dynamics. We also show how an analysis of village-level random effects predictions can help
targeting of policies to reduce poverty.
Keywords Poverty dynamics · Village effects · Multilevel models ·
Living Standard Measurement Survey · Vietnam
As it is well documented, Vietnam experienced a period of strong economic development and
a dramatic drop in overall poverty during the 90s (World Bank 2000; Balisacan et al. 2003).
However, the poverty reduction was not uniform across the country and socio-economic
groups (Justino and Litchﬁeld 2004). Previous work shows that poverty reduction was much
stronger in urban areas than rural ones (Glewwe et al. 2002). Moreover, compared to urban
areas, poverty reduction was much more heterogeneous within rural Vietnam.
In this paper we analyze the role of villages in poverty exit dynamics using data from the
rural sample of the Vietnam Living Standard Measurement Surveys (VLSMS) ﬁrst surveyed
B. Arpino (
Research and Expertise Centre on Survey Methodology (RECSM), Department of Political and
Social Sciences, Universitat Pompeu Fabra, C/Ramon Trias Fargas, 25–27 08005, Barcelona
“Carlo F. Dondena” Centre for Research on Social Dynamics, Department of Policy Analysis and
Public Management, Bocconi University, Milan, Italy