Comparative Analysis on Taiwan-Owned Enterprises, Local Firms, and Other Foreign-Owned Enterprises in Vi Etnam: Perspectives from Development and Current Status, Wage, Exports, and Productivity

Project Details


After implementing the New Labor Contract law in 2008, China experienced a sharply increase in labor costs,resulting in outflow of foreign capital to ASEAN countries. Meanwhile, members of ASEAN were lessimpacted by the global financial crisis in 2007-2008 and remained to experience persistent and spectaculareconomic growth. Vietnam, one of the rising stars among ASEAN, continues to attract sky-rocketing inflowof FDI and consequently increases exports. Vietnam is thought to be the next “World’s Factory". Taiwan’strade and outward FDI has transformed from highly concentrated on China to enhancing the relationship withASEAN. Although the “New Southbound Policy” has become one vital strategy of international trade andinvestment in Taiwan, firm-level analysis on FDI and trade of Taiwan-owned enterprises (TOEs) is almostabsent.This three-year project aims to appropriating the rich information contained in the annual economiccensus conducted by the General Statistical Office (GSO) of Vietnam for years 2001-2015(6) to conductanalyses from several dimensions.We first arrange data to conduct descriptive analyses on industrial and regional distributions ofTaiwan-owned enterprises in Vietnam. The corresponding distributions of other foreign-owned enterprises(FOEs) are also summarized, such as China, Korea, and Japan. Then, we analyze the bilateral trade relationsbetween Vietnam and its major investment countries. This preliminary FDI and trade analysis helps clarifythe development of TOEs and FOEs in Vietnam and provides insightful implications of TOEs regarding thesuffered competition and cooperation opportunities if they would like to establish the industrial supply chain in Vietnam.Nest, this project will examine three issues. First is the wage differential between TOEs and FOEs. Byestimating the Mincer wage equation, we investigate the potential wage differentials between TOEs, FOEs,and local firms. Particularly, whether the deregulation of deregulating minimum wage on FOEs generatesdifferent wage effects on FOEs of various nationalities is also examined. We then move to examine thedifference in export behaviors among FOEs. Third, I adopt the Metafrontier approach to examine the degreeof catching-up between Vietnam and FOEs as well as TOEs and other FOEs. Through the comparison ontechnological gap, we can evaluate how far the technological level of TOEs and other FOEs. Thisproductivity analysis helps clarify the relative technological advantages of TOEs in Vietnam.
Effective start/end date1/06/1731/05/18

UN Sustainable Development Goals

In 2015, UN member states agreed to 17 global Sustainable Development Goals (SDGs) to end poverty, protect the planet and ensure prosperity for all. This project contributes towards the following SDG(s):

  • SDG 8 - Decent Work and Economic Growth
  • SDG 10 - Reduced Inequalities
  • SDG 17 - Partnerships for the Goals


  • wage
  • export
  • productivity
  • technological catch-up
  • Taiwan-owned enterprises
  • Vietnam


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