A Study On The Impact Of Receiving Retirement Pension Benefits On Consumption Among The Elderly Population In Rural Areas

Population aging poses a formidable predicament for China’s contemporary economic progress.Scholars of demography maintain that a nation or region crosses the threshold into an aging society when individuals aged 60 years or above constitute 10% of the entire population,or when individuals aged 65 years or above account for 7% of the total population.Applying this metric,China has already entered a stage of population aging,exhibiting an increasingly pronounced trend.The seventh national census of China reveals that the population aged 60 and above stands at 264.02 million,comprising 18.70% of the total population,while the population aged 65 and above numbers 190.64 million,representing 13.50% of the total population.Additionally,the degree of population aging is progressively intensifying.Corollary research indicates that the aging phenomenon in rural areas is acuter than in urban areas,owing to factors such as rural-to-urban migrant labor and urbanization.Hence,an extensive the elderly population in rural areas has emerged in China’s rural regions.Based on the prevailing trajectory of China’s economic development,there still exists a considerable scope for expansion in the domestic demand market.The pivotal factor for ensuring stable economic growth in China is to augment the domestic demand and accomplish a "dual circulation" of the domestic and international markets.General Secretary Xi Jinping has persistently underscored the significance of concentrating on both the international and domestic markets.Rural residents’ consumption potential has remained untapped for a protracted duration,with the inadequacy of the social security system being one of the vital factors contributing to the underutilization of their potential for consumption,apart from the primary reason of low income.Furthermore,the escalating aging of the rural populace brings forth not only the emergence of latent consumer groups but also poses critical challenges concerning elderly care in rural areas.Confronted with the pressing need to refine the social security system,the rural elderly populace faces difficulties in fulfilling their retirement needs and expanding their consumption.Consequently,rural residents are inclined to curtail their current consumption expenses and augment their savings to meet their future retirement needs.Pension insurance constitutes the most crucial component of China’s social security system,as it effectively allocates the income of residents throughout their life cycle and curbs precautionary savings to stimulate consumption.Clearly,pension insurance assumes an indispensable role in promoting consumption among rural residents.Therefore,studying the mechanism by which pension benefits influence resident consumption is of paramount significance for establishing a robust social security system,stimulating resident consumption,and ensuring an enhanced quality of life for residents.The rural and urban resident basic pension insurance is the prevailing basic pension system implemented in rural areas,which is a unified basic pension insurance system established by merging the new rural social pension insurance and the urban resident social pension insurance.To delve further into the impact analysis,this study utilized data from the China Health and Retirement Longitudinal Study(CHARLS)in 2015,and conducted empirical research through the implementation of FRD model.The research scope is aimed at the rural elderly population,and as a result,the questionnaire data was specifically screened.Moreover,in order to comprehensively explore the consumption situation of farmers,this paper focused on two key areas: total consumption and consumption structure.For the analysis of overall consumption,variables such as the general consumption level of the sample group were selected,whereas for the study of consumption structure,variables such as basic consumption,developmental consumption,and enjoyment consumption were selected.Empirical analysis suggests that receipt of pension benefits can effectively increase the overall consumption level of the rural elderly population and improve the consumption structure of residents.However,the improvement effect is limited due to the low level of benefits.Based on the findings,the article concludes with policy recommendations that seek to effectively enhance the basic pension system and elevate the consumption level of the rural elderly population.