Difference in household income: The case of An Giang province

Abstract

This study employs decomposition by population subgroup and regression estimation methods to analyse the income inequality in An Giang province and investigate several indirect causes of this dispersion in household income. Results of the decomposition by population subgroups suggest that the province’s income inequality is mainly caused by inequality within urban areas and inequality within rural areas instead of income inequality between provinces. Both within-group inequality in the rural and urban areas are considerably greater than the inequality between these
areas. The income inequality in the rural area is greater than that in the urban area. Besides, regression estimation shows that the age, gender, ethnicity, health, and education of the household heads and the household characteristics
such as number and type of income sources, number of labour in the household significantly affect the household income. Differences in these indirect characteristics among households contribute to the difference in household income. Consequently, these differences in household characteristics partially explain the income inequality in An Giang province.