The impact of agricultural commercialisation on household welfare in rural Vietnam

Commercialisation by smallholder farmers has played a major role in agricultural development in many Asian countries, and while there are assumptions that this has led to welfare improvement, in fact there is relatively little evidence on this question. In this paper we use high quality panel data to examine the welfare impact of agricultural commercialisation in a leading Asian producer, Vietnam. We use the five-wave Vietnam Access to Resources Household Survey (VARHS) panel data set from 2008 to 16, three measures of household welfare and create commercialisation indexes in relation to all crops and to rice specifically. We find a significant positive relationship of commercialisation with household asset accumulation, but a negative association with consumption expenditure.