2. Household Structure, Living Standards Incomes and Savings

2.1. Household Structure

The identification of one person as the head of the household is an administrative requirement in Viet Nam. The oldest individual in the household is usually designated the head. Typically, the identified head is male. VLSS data is recorded at the household level (as opposed to the individual level). Therefore, the focus is on the sex of the head of the household in assessing the gender differences in household living standards.

The typical Vietnamese household is nuclear, consisting of one male adult, his wife, and two or three of their children. Nuclear households make up 71 percent of all households. Non-nuclear households are primarily those with three generations, including one of the couple's parents and/or grandchildren. The co-residence of adult siblings is rare.

Women marry around the age of 21 and they tend to marry men two to three years older than themselves. While the formation of a new household may be initiated by marriage, it is often not until after children are born that a new independent household is created, separate from the grandparents. Eventually however, by their mid to late 30s, most men are considered household heads of their nuclear households. Sometimes, adult couples continue to reside with one set of their parents, and the title of household head is passed onto the younger male, the adult son. Amongst men aged 65 and over, approximately 20 percent are identified within the household as the new household head's father. This has implications for household labour and income supplies, particularly as women more often move away from their own family household into their husband's household. This situation may be seen to provide greater advantage to those who have sons, who are less likely to shift their labour and income earning power away from the household.

Approximately one quarter (26 percent) of all households in Viet Nam is considered female-headed households (FHH)(17 percent in rural areas and 37 percent in urban areas). The designated male-headed household (MHH) is the norm, a pattern consistent with traditional family structures and views on gender roles, and their perceived relative economic importance. Female-headed households are female headed typically by default. While 96 percent of male household heads are married and have their spouse living with them, two thirds (67 percent) of female household heads do not have their spouse present in the household. Widowed women make up the majority of all female household heads (44 percent), while almost 7 percent of female household heads are currently married with their husbands residing elsewhere.

Figure 1 shows the distribution of marital status for MHH and FHH. MHHs overwhelmingly include a spouse, whereas FHHs typically do not.

Figure 1: Marital Status of Household Head, 1997-98

This leaves one third (33 percent) of female headed households with the male partner present in the home, suggesting that classification in terms of either male or female headed is arbitrary, and may not capture the diversity of ways in which family members identify within the household. It is evident that nuclear households that identify as female-headed are disproportionately urban and relatively, financially better off. While in male-headed households there is no difference between the hours spent in paid work by the head and his wife, in female-headed households with a spouse present the woman typically works much longer hours than her husband does. This suggests that households which designate women as household heads may be different in a systematic way from households designating a man as household head, and that the classification itself has much to do with paid work patterns.

2.2. Living Standard Differences between Male and Female Headed Households

Female-headed households typically are more mature households. They have older adults and fewer young children, therefore smaller household size. They are also disproportionately urban, where living standards are considerably higher than in rural areas. FHHs therefore, may be considered to exhibit a higher standard of living than MHHs, when measured by living standards indicators such as per capita expenditures (purchasing power), poverty incidence and caloric intake. However, this is only apparent as determined on a relatively short-term model of poverty, measuring consumption expenditures of households over a 12-month period. When assets, capacity to borrow and labour resources are also considered, FHHs in fact emerge as more vulnerable to the shocks that lead to declines in living standards long term.

The differences in living standards between FHHs and MHHs are also less substantial when compared separately in both rural and urban areas. The gap is smaller also for FHHs headed by women who are widowed or separated and/or divorced. While these households are still considered to exhibit higher standards of living than MHHs, the gap is reduced.

There exists is a great difference in living standards between FHHs with a spouse present, and those with no spouse present. FHHs with a spouse present in the household have distinctly higher living standards. The presence of an additional earning male contributes greatly to living standards of households. FHHs with no spouse present possess fewer labour resources and are therefore substantially more vulnerable to income shocks.

2.3. Gender Differences in Incomes and Expenditures

Household income has been calculated as the sum of income from crop production, livestock maintenance, aquaculture, non-farm self-employed enterprises, wage employment, remittances and other sources.

Figure 2 shows per capita expenditures and per capita income for MHHs and FHHs. Expenditure may be viewed as a reflection of the purchasing power of the household, and implies access to attributes that provide for a desirable living conditions. Although income of MHHs and FHHs are similar on average, the purchasing power of FHHs is much greater. This may point to the efficiency of FHHs in the allocation of scarce resources or might be due to additional sources of income, e.g. through remittances by husbands.

Figure 2: Per Capita Expenditures and Per Capita Income for MHHs and FHHs, 1997-98

Incomes are highest when both spouses are present in the household and households have multiple sources of income. FHHs without the head's spouse in the household have fewer income sources. As consumption is not dependent entirely on current earned income, consumption differences need not be consistent with income differences. Households with a male or female adult absent tend to receive remittances (unearned income), which also contribute to the incidence of FHHs without a spouse exhibiting a higher standard of living than MHHs. This is particularly the case in rural areas, where there is no difference in per capita incomes between MHHs and FHHs without a spouse. In urban areas, remittance incomes are not as common, and so urban FHHs with no spouse present have less per-capita income than those headed by males.

2.4. Gender Differences in Savings and Borrowing

The relationship between expenditures, savings and credit reflects the efficiency of the household in functioning as a small enterprise. A typical Vietnamese household has approximately 7.1 Million Dongs in savings and liquid assets (including cash, bank accounts, precious metals and jewellery). FHHs on average have slightly higher levels of savings than MHHs both in terms of savings per household as well as per household member. In urban areas, however, FHHs have less savings than MHHs. While there is no significant difference between FHH and MHH in total household savings, they do differ significantly in terms of savings per capita. FHH have a total savings of 3.6 Million Dong in urban areas and 1 Million Dong in rural areas, whereas MHH have 4.9 Million Dong in urban and 0.7 Million Dong in rural areas.

Almost one-half of all households borrow funds, though FHHs are less likely to borrow funds than MHHs. Figure 3 shows the proportion of all households borrowing, and the average amount borrowed, by sex of the household head.

Figure 3: Proportion of FHHs and MHHs Borrowing and Average Amount Borrowed, 1997-98

All households with a spouse (or one primary income) absent are much less likely to borrow funds, and also tend to borrow significantly smaller amounts. As FHHs have a far greater proportion of spouses absent, this discrepancy impacts disproportionately on them. Two-thirds of all funds borrowers are male, though information suggests that most loans are intended for the needs of the entire household, rather than those of specific individuals.

One-third of all loans is obtained from banks, yet women are far less likely to access banks, than men are. A 33 percent of all loans accessed by men are obtained from government banks (other than the Bank for the Poor). Only 18 percent of loans accessed by women are obtained from these banks. The most common sources of loans for women are informal, relying on private lenders such as relatives (27 percent of all loans) and other individuals (24 percent of all loans). Women also make use of the Bank for the Poor at a rate slightly less than that of men.

Women's use of private money lenders involves higher interest rates, and also reflects a lack of collateral-based lending on their part. While 41 percent of loans accessed by men are those requiring collateral, only 27 percent of women's loans are of this nature. This pattern is apparent even when the woman borrowing is designated the household head. This restricted access to credit limits the opportunity of FHHs to develop into small scale entrepreneurs.

The household's asset base is an important factor in accessing credit. FHHs with no spouse present face particular disadvantages in asset accumulation, and typically access credit requiring higher rates of interest than both MHHs and FHHs with a spouse present. The greater asset base of households with both spouses present and their ability to draw on multiple income sources makes these households less vulnerable to economic downturns than households with only one spouse present in the household, households which are overwhelmingly female headed.