Social Security Expansion and Neighborhood Cohesion: Evidence from Community-Living Older Adults in China

31 Pages Posted: 16 Dec 2019

See all articles by Elizabeth Bradley

Elizabeth Bradley

Vassar College

Xi Chen

Department of Health Policy and Management; Yale University - Department of Economics; Yale University - Yale Institution for Social and Policy Studies; IZA

Gaojie Tang

Shanghai University of Finance and Economics

Abstract

Grants and services provided by the government may crowd out informal arrangements, thus weakening informal caring relations and networks. In this paper, we examine the impact of social security expansion on neighborhood cohesion of elders using China's New Rural Pension Scheme (NRPS), one of the largest existing pension program in the world. Since its launch in 2009, more than 400 million Chinese have enrolled in NRPS. We use two waves of China Health and Retirement Longitudinal Study (CHARLS) to examine the effect of pension receipt on two dimensions of neighborhood cohesion among older adults, i.e. participation in collective recreational activities (e.g., socializing and organizational activities) and altruistic activities (e.g., helping those in need in the community), and the frequencies of these activities.Employing an instrumental variable approach, our empirical strategy addresses the endogeneity of pension receipt via exploiting geographic variation in pension program roll-out. We find evidence that receiving pension only slightly reduces collective recreational activities while significantly crowding out altruistic activities in the communities.

Keywords: neighborhood cohesion, pension, crowd out, diversity

JEL Classification: H55, I38, O22

Suggested Citation

Bradley, Elizabeth and Chen, Xi and Tang, Gaojie, Social Security Expansion and Neighborhood Cohesion: Evidence from Community-Living Older Adults in China. IZA Discussion Paper No. 12815. Available at SSRN: https://ssrn.com/abstract=3503765

Elizabeth Bradley (Contact Author)

Vassar College

124 Raymond Avenue
Poughkeepsie, NY 12604
United States

Xi Chen

Department of Health Policy and Management ( email )

60 College St
New Haven, CT 06520
United States

Yale University - Department of Economics ( email )

28 Hillhouse Ave
New Haven, CT 06520-8268
United States

Yale University - Yale Institution for Social and Policy Studies ( email )

77 Prospect Street
New Haven, CT 06520
United States

HOME PAGE: http://isps.yale.edu/team/xi-chen

IZA ( email )

Gaojie Tang

Shanghai University of Finance and Economics

777 Guoding Road
Shanghai, AK 200433
China

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