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Abstract:
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This study applies three theories; the human capital, the segmented labor market, and the social network theories, to investigate changes in earnings of displaced workers in Hanoi. The findings show that displaced workers suffer a loss in earnings due to destructions in skills, both specific and general. The result also supports the argument of the segmented labor market theory about changes in earnings of displaced workers. Those who move up to the higher paying economic segments enjoy a gain in earnings while those who move down to the low paying economic segment suffer a loss in earnings. As to the social network theory, there is a positive relationship between changes in social network and changes in earnings of displaced workers. However, the effect of changes in social ties is trivial while that of changes in social resource is extremely strong. The last finding is that displaced workers in Hanoi experience a rarely observed increase in earnings because of the special characteristics of the Vietnamese labor market. In general, findings from this study are consistent with the above three theories as well as the characteristics of the Vietnamese labor market. |