The objective of this study is to analyse the impact of various types ofgovernment spending on growth and poverty reduction, using provincial level data overthe last decade. Government spending reduces poverty through many channels such asagricultural growth and improved nonfarm employment. We will try to capture all thesedifferent effects in the analysis if the data allow. This paper opens with a review ofVietnam’s economic reforms and growth over the past decade. We then sketch Vietnam’spoverty profile, highlighting changes over time, regional distribution, and differencesamong population groups. In the next two chapters, we will review the trend andcomposition of government spending, agricultural R&D and infrastructure endowmentsin Vietnam over the last decade. Chapter 5 presents the analytical framework used toestimate the effect of various types of government spending on growth and povertyreduction. The data, model estimation, and results are presented in chapter 6. Weconclude the paper by offering future priorities for government investments in chapter 7.
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