ABSTRACT Internet usage has increased rapidly in rural Southeast Asia. However, the links among internet use, the growth of non‐farm sectors, and investment in agriculture remain insufficiently studied. This paper examines (i) the impact of internet use on rural non‐farm employment and non‐farm income of rural households, and (ii) the impact of non‐farm income on agricultural expenditure and investment. Using data from 6044 households in Thailand and Vietnam over 2 years, we employ a control‐function approach with instrumental variables to address endogeneity. Our results show that internet use promotes non‐farm employment and non‐farm income, for both off‐farm wage employment and non‐farm self‐employment. Heterogeneity analysis reveals that households with older heads, higher education, and membership in political or social organizations benefit more from internet use. In contrast, female‐headed and ethnic‐minority households gain less. However, higher non‐farm income is associated with lower agricultural expenditure and investment, suggesting a diversion of resources away from farm production. The findings highlight the need to expand internet access and strengthen rural education, while ensuring that agricultural production is not neglected. Targeted support for female‐headed and ethnic‐minority households is essential to prevent the widening of inequalities in rural development.
Tran et al. (Mon,) studied this question.
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