Year

2017

Degree Name

Doctor of Philosophy

Department

School of Accounting, Economics and Finance

Abstract

The process of economic development comprises a complex set of interrelationships between a large number of state and flow variables, some of which are controllable by public planners. This thesis analyses the relationships between such state and flow variables associated with economic development, environment and health.

Firstly, the thesis constructs and explores the conceptual framework comprising a two-period optimisation model. The model takes into account the control variables such as emissions, investments in technology, environment and health. The model assumes that a representative agent can maximise the agent’s expected utility by choosing optimal emissions and investments at the present and the future periods that depend on the agent’s consumption, health and the state of the environment. The general model is too complex to derive precise theoretical conclusions. Therefore, the thesis discusses a ‘business-as-usual’ model in which the representative agent does not invest in technology, environment and health and only generates pollution during the production process. Before deriving the precise theoretical predictions and testable hypotheses of interplay between production, emissions and health, the thesis discusses the ‘business-as-usual’ model by using a Cobb-Douglas specification of production function.

The thesis then empirically examines: (1) variations in the interrelated factors emphasized in the conceptual framework as measures of development. The factors are income, emissions, health services (number of patient beds as proxy) and population health (number of patient beds and tuberculosis prevalence as proxy) between and within regions in Vietnam; and (2) the hypotheses of simultaneous relationships between output, emissions and health in the case of Vietnam.

The Theil index analysis was adopted for the first problem and the result shows that: (1) the regions of highest income, such as the South East and the Red River Delta, have made the largest contribution to within-region and national inequalities in emissions; (2) high emission regions, such as the Mekong River Delta, made a large contribution to between-region health inequality; (3) high emission regions, such as North Midlands and Mountain, have had large contribution to within-region and national inequalities in population health; and (4) The aggregate contribution of inequality within regions to the national inequality in income, emissions and health has been larger than the contribution of the inequality between regions.

For the second problem Generalized Method of Moments (GMM) was adopted and the results show: (1) a significant positive effect of output on emissions; (2) a significant positive relationship between emissions and population health in the Mekong River Delta region; (3) significant positive impacts of population health and foreign direct investment on output; and (4) significant positive effect of foreign direct investment on emissions in the country and in the North Central and Central Coast regions where records of the environmental disasters caused by foreign direct investment projects are available.

Findings have policy implications for health, education, pollution and investment related issues for Vietnam. A major limitation of this study is the lack of available provincial data about environmental pollutants in Vietnam; however, estimated carbon dioxide emissions allowed some empirical results to be obtained.

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