Munich Personal RePEc Archive

Testing Proxy Means Tests in the Field: Evidence from Vietnam

Nguyen, Cuong and Lo, Duc (2016): Testing Proxy Means Tests in the Field: Evidence from Vietnam.

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During 2005-2015, the poor households in Vietnam were identified by Ministry of Labor, Invalid and Social Affairs (MOLISA) using an approach that combined proxy means tests (PMT) and quick collection of income data. A set of indicators were used to identify the surely poor and surely non-poor households. Then, income data were collected using simple questionnaires for the remaining households to identify the poor households. However, measuring income using simple questionnaires can result in a large measurement error. In attempt to improve the poverty targeting, with the technical supports from the World Bank and General Statistics Office of Vietnam, MOLISA has improved the PMT method and used it to identify the poor households since 2015. Income data are no longer collected. This report documents the current poverty identification approach, and the process of movement from the income-PMT approach to the PMT approach in Vietnam.

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