The Impact Of New Rural Social Endowment Insurance On The Rural Middle-aged And Elderly Labor Supply

Now China has stepped into an aging society as a whole,and the countryside is the difficulty and center of the aging problem.Since the new rural social endowment insurance was issued,it maintains a rapid development and has now entered a new stage of overall urban and rural areas.It not only aims at the policy of making the elderly taken care of but also bears the important task to maintain the sustainable development of rural labor force market.So far the new rural social endowment insurance has been implemented for seven years,the government and scholars also begin to pay close attention to its policy effect.However,as the policy hasn’t been put into practice for a long time,the effect turns into an intermittent.Meanwhile,at present stage,due to the few research on the effect of the new rural social endowment insurance and the abroad study controversy,the research,which is specially based on the relationship between the labor burden and rural labor market,is still in its infancy.This paper first reviews the research related to the research topic.With the support of the new rural endowment insurance system’s quasi public good theory and the labor force’s life circle theory,it introduces the household model to construct the utility maximization model to analyze the mechanism of the new rural endowment insurance on the labor supply of the rural middle-aged and elderly,including income effects and substitution effects.Then it reviews the historical evolution of rural endowment insurance system in China,and analyzes the current situation of the development of the new rural insurance from four aspects:the situation of the rural residents participating in this insurance,the mode of financing,the level of pension treatment and the level of protection.On empirical side,this paper selects China Health and Retirement Longitudinal Study(CHARLS)national household baseline investigate data,takes the samples which are 45 years old and above as the research object,uses the method of instrumental variables to solve the endogeneity problem,adopts Probit model and IV-Probit model to estimate the labor participation model,and uses Tobit model and IV-Tobit model to estimate the labor time model.In this paper,the survey found that the new rural endowment insurance will reduce its production supply while improving the overall labor supply and non-agricultural employment of labor.This paper finds that the new rural social endowment insurance tends to improve the supply of labor and the supply of non-agricultural labor in rural middle-aged and elderly people,and reduce the supply of labor in their own agricultural production.The implementation of the new rural social endowment insurance is conducive to the the flow of rural labor force.The new rural endowment insurance on the social security function of land has a substitution effect to some degree.The overall labor supply and non-agricultural employment of the insured group are higher than those of the non-insured group,which verifies the existence of "Ceaseless Toil" in the rural elderly.The new rural social endowment insurance has achieved some success in the system design,but the pension in China is based on the basic pension,the level of security is low.And the rural residents’ income sources are simple and payment level is low as well as local subsidies to raise responsibility sharing mechanism is not clear enough,it is not easy for the new rural endowment insurance fund to operate and make a profit effectively.Policymakers should take notice of not only the perfection of the new rural endowment insurance system construction but also the influence of the new rural social endowment insurance on the labor market.To solve these problems mentioned above,this paper puts forward some countermeasures and suggestions:First,further integrate the new rural social endowment insurance and urban social endowment insurance,optimize the system design;second,expand the income sources of the rural residents,improve it’s income structure;third,to further promote the coordinated development of the new rural social endowment insurance and other ways of providing for the rural elderly.