Working Paper
The welfare impact of Vietnam’s national target programme ‘building a new countryside’

We evaluate the impact on household income of Vietnam’s national target programme to build a new countryside for the period from 2010 to 2015.

The purpose of the programme is to modernize rural Vietnam. Given the universal implementation of the programme, we use a quasi-experimental approach whereby we employ three evaluation techniques which each have their own strengths and weaknesses: an income growth model (ordinary least squares), differences-in-differences, and propensity score matching.

We exploit the fact that not all rural communes graduated by the end of the period as ‘new rural communes’ and consider the unsuccessful communes as our comparison group. We find that the programme was responsible for an increase in household income of between 16 and 28 per cent, depending on the evaluation method used. As the comparison communes have also benefited to some extent from the programme, these percentages are an underestimate of the true effect.

We also find that the programme was pro-poor and that it raised non-farm income in particular.