This paper examines the impact of the transition to a market economy on health and education outcomes in transitional Asia, with particular focus on the case of Vietnam. After examining a variety of empirical evidence, several lessons emerge. First, protecting and improving health and education outcomes depends heavily on the success of economic reforms in generating income growth; strong economic growth generally increases outcomes. Second, the nature of the economy before the reforms has an important role in determining their overall impact. Third, small-scale experimentation of specific policies should be done before implementing them on a larger scale. Fourth, governments need to develop medium- to long-term plans for blending public and private provision of health and education services. Finally, because some groups will inevitably face serious problems, identifying and protecting vulnerable groups is an important task of the government after the reforms.