Economic contribution of environmental resources use to rural livelihoods in Vietnam

Abstract

This study aims to investigate the economic contribution of environmental resources use to rural livelihoods in Vietnam. Cluster analysis is applied to identify main household livelihood strategies. Headcount index, Poverty gap index, Lorenz curve and Gini index are used to identify the impacts of environmental income on household poverty and inequality. The cluster analysis identifies five livelihood strategies: wage dependency; non-farm , non-wage dependency; rnixed-income dependency; transfer dependency; and environment dependency. Environmental income accounts for 40.65% of total household income, of which 36.89% comes from agricultural activities and 3.77% comes from common property resources extraction. In addition, the study finds that environmentally dependent households are the most reliant on environmental resources in both relative and absolute terms. In terms of income inequality and poverty, on average the inclusion of environmental income reduces the Gini coefficient by more than 20%, from 0.598 to 0.475, and reduces the poverty headcount index, poverty gap and poverty severity by 28.0, 22.5 and 18.7 percentage points, respectively.