Forecasting income inequality in Vietnam’s regions using machine learning

Abstract

This study applies artificial neural networks (ANN) and support vector regression (SVR) to forecast the Gini coefficient across Vietnam’s seven socio-economic regions using limited data from 2014–2022 (N = 63). Despite the small dataset, robust techniques including repeated cross-validation, temporal backtesting, regularization, and bootstrapping were employed to mitigate overfitting. The results show a modest continued decline in income inequality through 2025, with faster improvements in urban regions (Red River Delta and Southeast) than in rural and highland areas. ANN outperformed SVR with an average cross-validation coefficient of determination (R²) of 0.93. The novelty lies in its granular regional forecasting and region-specific policy recommendations beyond national-level analyses. Key drivers—per capita income and simple housing—support targeted interventions such as housing credits in the Mekong River Delta and agricultural investments in the Central Highlands. The findings provide an evidence-based foundation for regionally tailored strategies to reduce income disparities in Vietnam.