Do pensions improve social participation? Evidence from China

Population ageing is a major demographic challenge, and China has one of the largest older populations in the world. In rural China, older adults often face financial pressure and reduced family support as younger generations migrate to cities, increasing the risk of social isolation. China introduced the New Rural Pension Scheme (NRPS) in 2009 to strengthen income security among rural older adults. Using data from the China Health and Retirement Longitudinal Study (CHARLS) and a fuzzy regression discontinuity design at the age-60 eligibility cut-off, this study examines the effect of NRPS receipt on social participation. The results show a positive local effect on interaction with friends among compliers near the cut-off, with limited changes in other forms of social participation. Subgroup estimates indicate variation across demographic and socioeconomic groups, while additional analyses find changes in farm-related work and self-employment. The findings show that pension receipt can affect an important social dimension of later life in addition to its economic role.