The Impact of Social Pension Scheme on Farm Production in China: Evidence from the China Health and Retirement Longitudinal Survey

Abstract

How does a social pension scheme affect farm production? This study addresses this question by investigating the effect of social pension on farm production by taking Urban and Rural Residents Pension Scheme (URRPS) in China as an illustration. Based on the implementation of the policy before and after the unification of URRPS, this paper uses the China Health and Retirement Longitudinal Survey (CHARLS) in 2011, 2013, 2015, and 2018 and conducts an analytical framework of the difference-in-difference model. The results show that, although the impact of URRPS on labor productivity is not significant, the pension income of URRPS significantly improves the land productivity of elderly farmers. Furthermore, the land productivity effect is larger for male farmers. This paper reveals the certain role played by pension scheme in promoting farm production, providing insights on alleviating the pressure of farm production brought by agricultural labor aging.