MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY ******* HOÀNG VĂN VIỆT INVESTIGATING THE COMPETITIVENESS OF VIETNAM’S AGRICULTURAL SECTOR: A MULTI-LEVEL APPROACH DOCTOR OF PHILOSOPHY DISSERTATION Ho Chi Minh City, December 2017 MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY ******* HOÀNG VĂN VIỆT INVESTIGATING THE COMPETITIVENESS OF VIETNAM’S AGRICULTURAL SECTOR: A MULTI-LEVEL APPROACH Major: Doctor Dissertation on Development Economics Code: 62310105 ACADEMIC ADVISERS: Assoc Prof Dr Trần Tiến Khai Assoc Prof Dr Từ Văn Bình A dissertation submitted to the University of Economics Ho Chi Minh City for the degree of DOCTOR OF PHILOSOPHY Ho Chi Minh City, December 2017 This dissertation is dedicated to the memory of my father-Hoàng Văn Thọ, to my mother-Trần Thị Sang, and to my daughterHoàng Nguyễn Minh Châu “The more I study science, the more I believe in God” -Albert Einstein- ACKNOWLEDGEMENT First of all, I would like to express my best gratitude to Prof Trần Tiến Khai, Prof Matthew Gorton, and Prof Carmen Hubbard Prof Trần Tiến Khai brings me in the research career with the initial lesson, advice, and passion Prof Matthew Gorton and Prof Carmen Hubbard raise me up to the international research standards with the advice, the lesson, and the research cooperation opportunities Second, I am deeply thankful to my teachers: Dr Phạm Khánh Nam, Prof Nguyễn Trọng Hoài, Prof Lionel Hubbard, Prof Peter Goldsmith, Prof Từ Văn Bình, Dr Trương Đăng Thụy, and Prof Nguyễn Ngọc Vinh for the lessons, guides, and advice Third, I am really indebted to my colleagues: Mr Nguyễn Khánh Duy, Ms Nguyễn Quỳnh An, Ms Nguyễn Hồng Mai, Ms Nguyễn Phan Trúc Phương, and Mr Hồ Minh Chí They contribute the important parts to my achievement of this dissertation Especially, I would express my gratitude and respect to Prof Nguyễn Đông Phong who indirectly empower me with the strategic and excellent policies for young lecturers Moreover, I am thankful to the board of professors, the independent reviewers, journal editorial boards, and journal reviewers for their constructive reviewing and comments I am wholeheartedly grateful to my family for their love, trust, support, sharing, and encouragement This dissertation would be never completed without them Ho Chi Minh City, December 2017 Hoàng Văn Việt DECLARATION I, Hoàng Văn Việt, declare that the PhD dissertation entitled “Investigating and Comparing the Agricultural Competitiveness of Vietnam” strictly conforms to the regulations and the rules of Ministry of Education and Training and the University of Economics Ho Chi Minh City This dissertation contains no material that has been submitted previously, in whole or in part, for the award of any other academic degree or diploma Except where otherwise indicated, this dissertation is my own work Ho Chi Minh City, December, 2017 Hoàng Văn Việt i TABLE OF CONTENTS LIST OF TABLES v LIST OF FIGURES vii LIST OF APPENDICES viii LIST OF ABBREVIATIONS x CHAPTER 1: INTRODUCTION 1.1 Background 1.2 Research gap identification 1.3 Research objectives and questions 1.4 Brief of research methodology, scope, and data 12 1.5 Expected significance and contribution 14 1.6 The structure and outline of the dissertation 16 CHAPTER 2: LITERATURE REVIEW 18 2.1 Definition of competitiveness 18 2.2 Evolution of competitiveness theory 23 2.3 Frameworks of competitiveness 34 2.3.1 Economic and production indicators 36 2.3.2 Trade performance indices 47 2.4 Summary and the general framework of the dissertation 56 CHAPTER 3: RESEARCH METHODOLOGY AND DATA 60 3.1 The trade performance indices 60 3.1.1 Revealed comparative advantage (RCA) 60 3.1.2 Relative trade advantage (RTA) 61 ii 3.1.3 Normalized revealed comparative advantage (NRCA) 62 3.1.4 Dynamics of comparative advantage indicators 64 3.1.5 Complementarity and substitutability analysis 68 3.1.6 Consistency analysis 70 3.1.7 The data for the trade performance indices 71 3.2 The economic and production indicators in the PAM model 72 3.2.1 Private profitability (PP - D) 73 3.2.2 Private cost ratio (PCR) 74 3.2.3 Social profitability (SP - H) 74 3.2.4 Domestic resource cost (DRC) 75 3.2.5 Social cost-benefit (SCB) 75 3.2.6 Nominal protection coefficient (NPC) 76 3.2.7 Effective protection coefficient (EPC) 77 3.2.8 Profitability coefficient (PC) 77 3.2.9 Subsidy ratio to producers (SRP) 77 3.2.10 The data and estimations for the PAM indicators 77 3.2.11 Sensitivity analysis of the PAM indicators 83 CHAPTER 4: VIETNAM’S AGRICULTURAL TRADE COMPETITIVENESS: THE CROSS-SECTIONS ANALYSIS 85 4.1 Vietnam’s agricultural trade competitiveness by the RCA 85 4.1.1 Measuring the static competitiveness 85 4.1.2 Analyzing the dynamics of the competitiveness indicators 87 4.2 Vietnam’s agricultural trade competitiveness by the RTA 91 iii 4.2.1 Measuring the static competitiveness 91 4.2.2 Analyzing the dynamics of the RTA indicators 92 4.3 Vietnam’s agricultural trade competitiveness by the NRCA 96 4.3.1 Measuring the static competitiveness 96 4.3.2 Analyzing the dynamics of of the NRCA indicators 98 4.4 The consistencies of the trade performance indices: sector-ranking 101 CHAPTER 5: THE ASEAN COUNTRIES’ AGRICULTURAL TRADE PATTERNS: THE CROSS-COUNTRIES ANALYSIS 103 5.1 The agricultural international trade performance of ASEAN countries 104 5.1.1 Agricultural competitiveness by the RCA 104 5.1.2 Agricultural competitiveness by the RTA 106 5.1.3 Agricultural competitiveness by NRCA index 107 5.1.4 Analyzing the dynamics of agricultural competitiveness indicators 109 5.2 The trade agricultural complementarity of the ASEAN countries 111 5.2.1 The agricultural trade complementarity of the ASEAN countries 111 5.2.2 The agricultural export similarity of the ASEAN countries 113 5.2.3 The agricultural complementarity by Spearman coefficients 114 5.2.4 The impact of external markets and factors 117 5.3 The consistencies of the trade performance indices: country-ranking 119 CHAPTER 6: THE COMPETITIVENESS OF ALTERNATIVE AGRICULTURAL CROPS: A CASE STUDY OF BEN TRE 121 6.1 Measuring the comparative advantage of the alternative crops 122 6.1.1 The comparative advantage of rice 122 iv 6.1.2 The comparative advantage of coconut 125 6.1.3 The comparative advantage of pomelo 128 6.2 Indicators and sectors consistency and comparison analysis 130 6.3 Sensitive analysis of the comparative advantage indicators 134 6.3.1 Climate changes 134 6.3.2 Water and land charges 135 6.3.3 The parameters of assuming changes of the variables 136 CHAPTER 7: CONCLUSION AND IMPLICATIONS 139 7.1 Vietnam’s agricultural trade competitiveness 139 7.2 The ASEAN countries’ agricultural trade patterns 141 7.3 Competitiveness of alternative agricultural production systems in Ben Tre 143 7.4 Theoretical analysis and conclusion 146 7.5 Policy implications 148 Re-structuring the agricultural production and trade pattern 149 Maintaining the rankings of strong competitiveness sectors 150 Expanding and enforcing the regional and global integration 151 Building the agricultural production master plans 152 Promoting sustainable agriculture and adapting to climate changes 153 LIST OF MY PUBLICATIONS & PROJECTS LIST OF REFERENCES APPENDICES 29 v LIST OF TABLES Table 2-1: The evolution of competitiveness theory 33 Table 2-2: The measures of competitiveness by level of analysis 35 Table 3-1: The accounting structure of policy analysis matrix 73 Table 3-2: Sample descriptions for the PAM indicators 79 Table 4-1: Vietnam’s top agricultural competitiveness by the RCA 86 Table 4-2: The change of the RCA indicators position between 1997 and 2014 87 Table 4-3: The OLS estimation results for the RCA indicators over three periods 88 Table 4-4: The classifications of RCA values and the interpretations 89 Table 4-5: The M-Shorrocks and Markov transition matrix for the RCA values 89 Table 4-6: The top gaining and losing trends of the RCA indicators 90 Table 4-7: Vietnam’s top agricultural competitiveness by the RTA 92 Table 4-8: The changes of the RTA indicator ranks between 1997 and 2014 93 Table 4-9: The OLS estimation results for the RTA indicators over three periods 93 Table 4-10: The classification of the RTA values and the interpretations 94 Table 4-11: The M-Shorrocks and Markov transition matrix for the RTA values 95 Table 4-12: The top gaining and losing trends of the RTA indicators 96 Table 4-13: Vietnam’s top agricultural trade competitiveness by the NRCA 97 Table 4-14: The changes of the NRCA indicator ranks between 1997 and 2014 98 Table 4-15: The OLS estimation results for the NRCA indicators over time 99 Table 4-16: The classification of the of NRCA values and the interpretations 99 Table 4-17: The Markov transition probability matrix for the NRCA indicators 99 Table 4-18: The top gaining and losing trends of the NRCA indicators 100 Table 4-19: The consistencies the RCA, the RTA, and the NRCA by sector-ranking 102 Table 5-1: The agricultural competitiveness of the ASEAN countries by the RCA 105 Table 5-2: The number of strong agricultural competitive sectors by the RCA 106 Table 5-3: The agricultural competitiveness of the ASEAN countries by the RTA 107 ... December 2017 Hoàng Văn Việt DECLARATION I, Hoàng Văn Việt, declare that the PhD dissertation entitled “Investigating and Comparing the Agricultural Competitiveness of Vietnam” strictly conforms... the dynamics of the RTA indicators 92 4.3 Vietnam’s agricultural trade competitiveness by the NRCA 96 4.3.1 Measuring the static competitiveness 96 4.3.2 Analyzing the dynamics... to assess the static and dynamics competitiveness of Vietnam Especially, there is no study testing the consistency of the trade performance indices in the case of Vietnam Therefore, there is an