Macroeconomic Factors Influencing the Standard of Living in Lao PDR

บทคัดย่อ

Laos People’s Democratic Republic (Lao PDR) has experienced a serious inflation problem which caused the price of goods and services to rise for several years up to the present. Moreover, the depreciation of the Kip currency compared to the US dollar and Thai baht, especially fuel price which is an imported commodity has increased. As a result, many people face hardships in daily life due to the rising cost of living. Therefore, this research aims to study the macroeconomic factors affecting the standard of living of Lao PDR. The dependent variable is GDP per capita which represents the standard of Living (STL). The data used was the secondary data of the annual time series from 1990 to 2023, a total of 33 years, and examined by a multiple regression model using the Ordinary Least Square method.

The findings indicate that the factors positively influencing STL in Lao PDR include the unemployment rate (UNEM), foreign direct investment (FDI), the industrial sector’s share of GDP (IND), and the exchange rate of kip to the U.S. dollar (EXUS). Moreover, a factor exerting a negative influence is the inflation rate (INF). However, other factors, such as GDP growth, and global oil prices did not significantly explain the STL. This research enhances the government sector in formulating policies to improve a better standard of living for the Laos people.