Climate Shocks in Vietnam, Agriculture, Migration, and Structural Transformation

This paper investigates how climate shocks in the agricultural sector drive migration and facilitate structural transformation, focusing on Vietnam. Utilizing panel data from 1986 to 2020, the study employs a fixed effects model to analyze the relationship between extreme climate events, such as floods and storms, and socio-economic changes. The findings reveal that the increased frequency of climate shocks significantly drives migration from rural to urban areas. Thus, carrying a notable shift in economic activity from agriculture to manufacturing and services, facilitating structural transformation in line with the Lewis Model. The analysis shows that climate-induced migration helps reallocate labor to more productive sectors, contributing to economic diversification. This research provides robust evidence of the dynamic interplay between climate variability, migration, and economic restructuring, offering valuable insights for policymakers to enhance resilience and support sustainable development in Vietnam.