Do Monetary and Non-Monetary Indicators Tell the Same Story About Chronic Poverty? A Study of Vietnam in the 1990s

Abstract

This paper investigates whether monetary and non-monetary indicators tell the same story about chronic poverty using a unique two-period household panel from Vietnam in the 1990s. Using transition matrices and a simple measure of immobility, we find that monetary poverty is less persistent than malnutrition among adults and stunting among children (although there is some evidence of catch-up among stunted children). Monetary poverty is also found to be less persistent than primary and lower secondary school enrollments. Non-parametric tests on common samples reveal that the distributions of all these poverty indicators are different. Furthermore, defining chronic poverty to occur when an individual is monetarily poor, stunted, malnourished or out of school in both waves of the panel, we find the extent of overlap and correlation between the sub-groups of chronically poor is generally quite low. This implies that expanding the number of dimensions used to identify chronic poverty may not lead to greater clarity about the characteristics of chronic poverty.

Keywords: Poverty Dynamics, Vietnam, Data, Multidimensional Poverty Methodology, Multidimensional Poverty Measurement