The environment-poverty nexus using a multidimensional poverty index in rural Vietnamese households

The environmental-poverty nexus has been subject to research especially in relation to climate change. On the one hand, poor households depend on environmental resources as additional income sources or as additional household products. On the other hand, natural resource extraction further drives climate change. We build on the existing literature using socio-economic panel data from Vietnam to calculate environmental income variables and a multi-dimensional poverty index (MPI). MPIs have been developed to understand poverty in more detail and implement more efficient policies to lift people out of poverty. We use a fixed effects panel logit regression and find that households with higher dependency on environmental income are more likely to be multi-dimensionally poor. Households engaged in extraction activities are larger, less educated and have lower asset values. Natural resource dependence needs to be considered using participatory approaches for successful policies against climate change. Furthermore, structural deprivations such as lack of availability of electricity should be addressed to reduce multidimensional poverty.