THE ROLE OF OLD-AGE INSURANCE SYSTEM IN PROMOTING THE SATISFACTION AND EMOTIONAL REGULATION OF THE ELDERLY IN RURAL CHINA: FROM THE PERSPECTIVE OF HETEROGENEOUS INCOME EFFECT
Authors: Chi Zhenhe , Shen Ce , Williamson John B 
Published: July 2022

Abstract

Background
In the process of global population aging, old-age insurance, as the most important channel to provide income support for the elderly, is the need of countries all over the world, especially developing countries. As the largest developing country in the world, China launched the “new rural pension plan” (NRPS) pilot pension plan in 2009. By the end of 2012, the pilot has been extended to all counties in the country. The most disappointing thing about NRPS is that compared with China's rural absolute poverty line, pension benefits across the country are very low. However, even if the basic pension benefits are very low, most of the registered elderly in rural China are very satisfied with the NRP. Although NRPS has limited impact on improving the income of the elderly due to the low national pension treatment, how to explain the elderly's satisfaction with the plan and its role in the emotional regulation of the elderly?

Research Objects and Methods
Among all the outcome variables of NRPS, income is the most critical one, because all other outcome variables are determined by income. Therefore, this study uses the national representative data of 2013 and focuses on the impact of NRP on the income of the elderly. Then, we use quantile regression in regression discontinuity design (RDD) to show the income impact of NRP on different income groups, especially low-income groups, in order to answer this question from the perspective of the heterogeneous income impact of NRP. At the same time, we analyzed the correlation between emotion regulation ability and social loneliness. The results show that the aggregation validity: the correlation between Russell's emotional loneliness item and UCLA Loneliness Scale is 0.44, and the correlation between the item “no one can trust”, the correlation value is 0.4, and the correlation value between “I'm no longer close to anyone” is 0.44. The correlation between social loneliness and UCLA scale was 0.47, the correlation between social loneliness and UCLA scale was -0.47, and the correlation between social loneliness and UCLA scale was -0.35. In other words, the items in UCLA that should be related to Russell's problems in theory are actually significantly higher than other items. Social and emotional loneliness is related to the six factors that Weiss proposed in interpersonal relationships, namely attachment, social integration, development opportunities, recognition of value, trusted alliance and guidance. Social loneliness is most related to the demand for uncertain value, while emotional loneliness is most related to the need for attachment. Social and emotional loneliness were significantly correlated with depression; Only emotional loneliness is related to anxiety. On the whole, these results are in line with R.S. Weiss's theory.

Results
The results show that NRP successfully improves the income of all income groups, although the impact of NRP on the median income distribution is limited due to the low pension benefits. Among all income distribution ratios, NRP plays a disproportionate role in increasing the income of the elderly: the positive role of the top of income distribution is much greater than that of the bottom. We also found that in all percentiles, NRP has a greater positive impact on rural elderly women than rural elderly men, thus narrowing the gender income gap in rural China. Even if the impact of China's rural minimum living security scheme on increasing the income of rural elderly is controlled, these findings are still reliable. In the process of the influence of life events on anxiety, emotional response plays an intermediary role and psychological elasticity plays a regulatory role. Psychological resilience regulates life events through the mediating effect of emotional response on anxiety. That is, the higher the psychological elasticity, adjust the impact of life events on anxiety through coping style to reduce it; On the contrary, the lower the level of psychological elasticity, adjust the impact of life events on anxiety through coping style to increase it.

Conclusion
Although the disproportionate impact of NRP on all percentiles exacerbates the income inequality of the rural elderly, it provides an income risk aversion mechanism for the first time in Chinese history. Under the framework of expected utility theory, the actual value of the mechanism is much greater than its monetary value, resulting in higher satisfaction of the rural elderly. Since the NRP has limited effect on increasing the income of the rural elderly, we suggest reforming the NRP, such as increasing the basic pension treatment of the rural absolute poverty line, transitioning to non contributory pension plan, and unifying the provincial plan into a national plan.