Abstract
The causal effect of public pensions on the mental wellbeing of the elderly in lower and middle-income countries deserves further investigation. This paper first constructed a theoretical framework for the impact of New Rural Society Pension Insurance pensions in China on the mental wellbeing of the rural elderly, and described potential channels through which pension income may affect mental wellbeing. We then used the fixed effect model and the instrument variable approach to estimate the casual effects of pension income on the mental wellbeing of the rural elderly. The results reveal that pension income improves mental wellbeing by relieving depression of the rural elderly; however, the beneficial effects of pension income are very limited. Pension income has no beneficial effects on the mental health of the rural elderly in the east region, whereas it slightly relieves depression of those in the middle and west regions. We also found that pension income produces small improvements in the mental health of older females, elderly persons living independently, and those with relatively poor economic conditions.
Highlights
The unprecedented population aging brings one of the biggest challenges for lower and middle-income countries (LMICs) to ensure the wellbeing of their growing old population
Based on the theoretical framework, this paper constructs fixed effect models to estimate the impact of the New Rural Society pension income (Pension) Insurance (NRSPI) pensions on mental health outcomes of the rural elderly
This paper first established a theoretical framework for the impact of the NRSPI pensions on mental wellbeing based on the agricultural household model and the health production model, and described plausible pathways from pension income to mental wellbeing
Summary
The unprecedented population aging brings one of the biggest challenges for lower and middle-income countries (LMICs) to ensure the wellbeing of their growing old population. Further understanding of the causal effect of public pensions on mental wellbeing, measured by depression score and depressive symptoms, is of significant importance for LMICs in order that they can develop more effective pension programs as well as mental health prevention and treatment policies. Two recent studies on the NRSPI program in China both found that the NRSPI pensions significantly improved mental health of rural elderly by decreasing the depression score or depressive symptoms [13,33]. Cheng et al [33] measured psychological wellbeing by total score of only six items, which has been less used in standard psychological health measures in the literature They did not analyze the impact of pension income on the rate of depressive symptoms, which may be more important to assess the seriousness of depression.
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