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Labor Supply Responses to New Rural Pension Insurances in China: A Regression Discontinuity Approach

Chen, Zeyuan LU ; Bengtsson, Tommy LU and Helgertz, Jonas LU (2015) In Lund Papers in Economic History. Population Economics
Abstract
Transitioning into retirement is an under-researched phenomenon in developing countries. Largely, this is linked to a predominance of contexts where –in particular –the rural population remains outside the coverage of any formal pension system. In 2008, China introduced the New Rural Social Pension (NRSP), a program which by now covers the majority of the Chinese rural elderly. This paper examines the effects of the NRSP on the labor supply of the elderly in rural China. As pension benefit eligibility at the time of its implementation is conditional on age, a regression discontinuity design is applied to investigate the casual effect of the receipt of pension benefits on labor supply. Furthermore, as the NRSP isneither means-tested nor... (More)
Transitioning into retirement is an under-researched phenomenon in developing countries. Largely, this is linked to a predominance of contexts where –in particular –the rural population remains outside the coverage of any formal pension system. In 2008, China introduced the New Rural Social Pension (NRSP), a program which by now covers the majority of the Chinese rural elderly. This paper examines the effects of the NRSP on the labor supply of the elderly in rural China. As pension benefit eligibility at the time of its implementation is conditional on age, a regression discontinuity design is applied to investigate the casual effect of the receipt of pension benefits on labor supply. Furthermore, as the NRSP isneither means-tested nor conditions on retirement, it induces a pure income effect on employment. Using data from the China Health and Retirement Longitudinal Study, a nationally representative data set, we find that the receipt of pension benefitsincreases the probability of retirement among the rural elderly by around 15%. (Less)
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author
organization
publishing date
type
Working Paper
publication status
published
subject
keywords
China, Regression discontinuity, Labor supply, Retirement, New Rural Social Pension
in
Lund Papers in Economic History. Population Economics
issue
139
pages
40 pages
publisher
Department of Economic History, Lund University
language
English
LU publication?
yes
id
2d56dc24-9ce3-4953-9f6c-90f32880bebf (old id 8058346)
date added to LUP
2015-10-19 16:16:09
date last changed
2016-04-16 08:35:37
@misc{2d56dc24-9ce3-4953-9f6c-90f32880bebf,
  abstract     = {Transitioning into retirement is an under-researched phenomenon in developing countries. Largely, this is linked to a predominance of contexts where –in particular –the rural population remains outside the coverage of any formal pension system. In 2008, China introduced the New Rural Social Pension (NRSP), a program which by now covers the majority of the Chinese rural elderly. This paper examines the effects of the NRSP on the labor supply of the elderly in rural China. As pension benefit eligibility at the time of its implementation is conditional on age, a regression discontinuity design is applied to investigate the casual effect of the receipt of pension benefits on labor supply. Furthermore, as the NRSP isneither means-tested nor conditions on retirement, it induces a pure income effect on employment. Using data from the China Health and Retirement Longitudinal Study, a nationally representative data set, we find that the receipt of pension benefitsincreases the probability of retirement among the rural elderly by around 15%.},
  author       = {Chen, Zeyuan and Bengtsson, Tommy and Helgertz, Jonas},
  keyword      = {China,Regression discontinuity,Labor supply,Retirement,New Rural Social Pension},
  language     = {eng},
  note         = {Working Paper},
  number       = {139},
  pages        = {40},
  publisher    = {Department of Economic History, Lund University},
  series       = {Lund Papers in Economic History. Population Economics},
  title        = {Labor Supply Responses to New Rural Pension Insurances in China: A Regression Discontinuity Approach},
  year         = {2015},
}