The Impact of International Integration on the Inequality of Income between Rural and Urban Areas in Vietnam

The study examines the impact of international integration on Vietnam's rural and urban income inequalities using the regression model. The data used for this study is based on the results of the Vietnam Household Living Standards survey from 2008 to 2016 of the General Statistics Office. These surveys conducted nationwide with a sample size of 46,995 households in 3,133 communes/wards which were representative at national, regional, urban, rural and provincial levels. The level of international economic integration used in the study is the proportion of import and export turnover of GDP, the proportion of FDI and GDP by province. Due to the heterogeneity and unobservableness of the single observant in the data set, we selected the models of random and fixed effects. The research results show that during the economic integration process, the Export/GDP factor is negatively related to income inequality. The remaining factors (GDP per capita, FDI/GDP, Educational level of households, Percentage of intemet users, Aggregation of foreign cash inflow and GDP of the province) are all positively related to income inequality. The findings help assess the impact of international integration on rural-urban income inequality, but also provides a concrete basis to help policymakers address income inequality in the integration process.