Forest resources and household welfare: Empirical evidence from North Central Vietnam

Using secondary data from a socio-economic quantitative household survey of the North Central region of Vietnam, the main aim of our study is to analyze the causal effect of forest resources on household income and poverty. Based on the observed characteristics of a forest-based livelihood and forest-related activities, we use a propensity score matching (PSM) method to control for potential bias arising from self-selection. The PSM results indicate that households with a forest-based livelihood had a higher level of income and lower poverty rates than did those without. Interestingly, our findings confirm that a forest-based livelihood offers much higher income than any other type of livelihood adopted by local households. Also, the poverty rate among households with a forest-based livelihood is lower than those earning non-labor income or engaged in wage/crop and crop livelihoods. Among households and provinces, we find varying opportunities deriving from forest resources, suggesting that there are potential barriers hindering local households from pursuing a forest livelihood or participating in some forest activities. Therefore, government policy and regulations on forest management should focus on improving the access of households to forest resources, while enhancing the sustainability of these resources.