ABSTRACT
At the end of the American war Viet Nam was a country with a dilapidated infrastructure and two dysfunctional and disconnected economies. In the north, decades of central planning had led to very low productivity and generalized shortages. In the south, collectivization had brought to a standstill the once dynamic but chaotic market economy supported by the US war machinery. Smallholder farming had the virtue of being labour-intensive, but soon after massive numbers of additional jobs needed to be created in cities. While earnings may still be low by international standards, a large fraction of the population has the traits associated with middle classes elsewhere. The Vietnamese leadership was reluctant to reform state ownership, because it was seen as the symbol of socialism, an instrument of power, and a tool to make strategic choices. A commonly held view has Viet Nam's reform process as an imitation of China's, with a 10-year lag. The reality is more complex.
