Cluster analysis in term of sustainability and digitalization of Vietnamese regional economies

Economics

The development of Vietnam in Covid-19 period has received the good reviews from economists around the world. The economic growth is still positive, the digital application is gradually popularized and the economy demonstrates its sustainable resilience towards instabilities. However, within Vietnamese territories, the differences between 63 provinces are still remarkable in term of sustainability and digitalization. This paper applies empirical method of K-Means Clustering Analysis to classify provinces into 4 clusters with 4 input variables: Regional economic growth rate, Digital Transformation Index, Public Administration Reform Index and Public Corruption Control Index. The paper shows that cluster 2 with 11 provinces has brilliant performance compared with other clusters, they get a lot of motivation for further development. Meanwhile, cluster 4 with 24 underdeveloped provinces has difficulties at starting point, but they have large potential to develop in the future. Based on the characteristic analysis for each cluster, the research proposes relevant policies to create favorable condition to encourage the sustainable and digitalized development.

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