Income Inequality and Middle-Income Class in Vietnam

Abstract

The paper assumes the relationship between the middle-income class and inequality in income distribution as follows: In pre-industrial and early industrial societies, inequality in income distribution increased when the middle-income classes were small; In the later stage, the more industrialized society developed, the more the middle-income classes expanded while the inequality in income distribution decreased. Based on the results of data processing from the Vietnam Household Living Standards Survey (VHLSS) from 2002 to 2020 conducted by the General Statistics Office, the paper proves that the above research hypothesis is appropriate with the ongoing industrialization in Vietnam (2002-2020); and forecasts that inequality in Vietnam will continue to decrease (after 2020) until the end of the industrialization process.