Effects of health insurance on labour supply: evidence from the health care fund for the poor in Vietnam

N. Lê*, W. Groot, S.M. Tomini, F. Tomini

*Corresponding author for this work

Research output: Contribution to journalArticleAcademicpeer-review


The expansion of health insurance in emerging countries raises concerns about the unintended negative effects of health insurance on labour supply. This article examines the labour supply effects of the Health Care Fund for the Poor (HCFP) in Vietnam in terms of the number of work hours per month and labour force participation (the probability of employment). Employing various matching methods combined with a Difference-in-Differences approach on the Vietnam Household Living Standard Surveys 2002–2006, we show that the HCFP, which aims to provide poor people and disadvantaged minority groups with free health insurance, has a negative effect on labour supply. This is manifested in both the average number of hours worked per month and the probability of employment, suggesting the income effect of the HCFP. Interestingly, the effects are mainly driven by the non-poor recipients living in rural areas, raising the question of the targeting strategy of the programme. © 2019, © 2019 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group.
Original languageEnglish
Pages (from-to)6190-6212
Number of pages23
JournalApplied Economics
Issue number58
Publication statusPublished - 2019

JEL classifications

  • i13 - Health Insurance, Public and Private
  • j22 - Time Allocation and Labor Supply


  • Health insurance
  • Viet Nam
  • Vietnam
  • developing world
  • employment
  • health care
  • health care fund for the poor
  • health insurance
  • labor participation
  • labor supply
  • labour supply
  • living standard
  • minority group
  • service provision
  • socioeconomic survey
  • strategic approach


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