Incentives and static and dynamic gains from market reform: rice production in Vietnam

Tuong Nhu Che, Thomas Kompas, Neil Vousden, Neil Vousden

    Research output: Contribution to journalArticle

    Abstract

    This article develops a dynamic model to account for the enhanced incentive effects that result from market reform through a move toward private property rights and competitive markets. Reform is captured through an emerging profits function which depends on effective prices and incentives to work harder. Static and dynamic output gains from reform are derived through increases in total factor productivity and induced capital accumulation. The model is applied to rice production in Vietnam over the period 1976-94. The more extensive is market reform, the larger the effects found on rice output, the capital stock and transitional growth rates, suggesting that incentives and more competitive markets matter greatly.
    Original languageEnglish
    Pages (from-to)547-572
    JournalAustralian Journal of Agricultural and Resource Economics
    Volume45
    Issue number4
    Publication statusPublished - 2001

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