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The dynamics of Vietnam agriculture under changing conditions

Although Vietnam has undergone fundamental transformation since the economic reforms in the late 1980s, agriculture continues to play a pivotal role in the economy. Given the rising food demand and declining availability of farmland areas, improvements in rice technology are vital for Vietnam to maintain food security and export status. Despite the rising application of high-yielding varieties, rice productivity growth slowed down. The sustainable development of Vietnam agriculture is facing additional challenges due to changing climate which is expected to affect several aspects of agriculture. To date, there has been little insight into how Vietnam agriculture is likely to be impacted by these drivers. This thesis is among the first studies which provided robust estimates of the impacts of technology change and climate change on the Vietnam agrarian economy. Utilizing data from the Vietnam Access to Resources Household Surveys (VARHS) 2006 -2016, this thesis examined the major ongoing changes in Vietnam agriculture and likely impacts of these changes. Three specific relationships were examined: (1) The relationship between hybrid rice seeds and productivity; (2) the relationship between climate change and agricultural productivity; and (3) the relationship between changing climate and land use choice as an adaptation strategy and its likely impact on long-term food security. The literature on hybrid rice has reported superior productivity of hybrid rice seeds over inbred varieties. This is not supported by our panel stochastic frontier estimates pertaining to productivity impact assessment for Vietnam. Estimates of a large managerial gap indicate a handsome benefit from efforts to increase productivity. Vietnam is expected to be among the countries hardest-hit by climate change. However the panel Ricardian model suggests marginal impacts, even in the long run when the projected changes are more severe. Changing crops is an adaptation to climate change. The empirical findings from the Fractional Multinomial Logit model indicate the sensitivity of the Vietnam land use system to climate. Seasonal climates exert heterogeneous impacts on land use shares for different crops. The projected climate changes are expected to induce large shifts from cereals to annual industrial crops in the two rice bowls of the country. This thesis made several contributions to impact assessments and suggested policy implications. First, the productivity impact assessment in Chapter 3 provides a simple way to control for selectivity bias in a panel stochastic frontier framework while allowing for direct comparisons of the base productivity, factor productivity, and technical efficiency. Second, the analyses of climate impacts and crop choice in Chapter 4 and Chapter 5 provide a simple way to relax the assumption of a constant effect of market feedbacks in climate change assessments and this avoids biased climate estimates. Finally, this thesis provides valuable policy implications regarding the development of rice technology and climate change adaptation in a developing country where agriculture supports income and employment for a large portion of the population.  
Type of thesis
The University of Waikato
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