Research on the behavior of using compensation money for land clearance of households in the north rural of Vietnam

Abstract

This paper aims to research the behavior of using compensation money for land clearance of households in the north rural of Vietnam. Applying the Binary Logistic model to the primary dataset collected from 139 households whose land is acquired and compensated for land clearance in three
areas: Hanoi, Bac Giang and Bac Ninh through in-depth interviews and questionnaires, the empirical findings confirm that the use of land clearance compensation by households to invest in the industry, agriculture, services and savings will increase the probability of increasing household’s income. If
households are involved in negotiations when implementing acquisition and compensation for land clearance, it also increases the probability of increasing their income. However, if a household uses compensation money for land clearance to invest in wrong purposes activities, the probability of
increasing the household’s income will decrease sharply. Meanwhile, the education of the head of the household, using the compensation for land clearance to invest in education, the area of land acquired and the area of land to be compensated did not affect the probability of increasing the
household’s income. The paper also provides recommendations to improve the efficiency of using compensation for land clearance by rural households.