Aquaculture, household income and inequality in Vietnam’s coastal region

Abstract

Using data from the 2020 Vietnam Household Living Standards Survey, we examine the link between aquaculture, household income, and inequality in Vietnam’s coastal region. Using a two-step cluster analysis, we identify five clusters of livelihood strategies (LS) pursued by local households. We find that about 13% of the total number of households are engaged in aquaculture, but only 6% pursued an aquaculture LS, while half the number of households followed a wage-earning LS. Our regression analysis shows that, on average, those in the aquaculture LS cluster have higher incomes than those in the wage-earning or “other income” LS clusters. Interestingly, the quantile regression result reveals that in the top percentiles of income distribution, those adopting an aquaculture livelihood attain higher incomes than those in all other livelihood clusters. This implies that there is a positive link between the choice of aquaculture LS and household income. Also, we find that aquaculture land is positively associated with the likelihood of participation in aquaculture and deriving income from it. Notably, Gini decomposition analysis indicates that the distribution of aquaculture land and income from it are highly uneven and skew much more towards the well-off. Given the significant positive relationship between aquaculture land and the profitability of the aquaculture LS, our findings imply that expanding the aquaculture sector (e.g., granting access to aquaculture land or/and training in skills for aquaculture farmers) may help local households boost their income and reduce inequality in the coastal region.