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Old age allowances and cognitive function: A quasi-experimental study of China's oldest-old

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  • Fang, Guanfu
  • Tang, Tianyu

Abstract

The population aged 80 and above (the oldest-old) represents the fastest-growing age group globally and has the greatest need for maintaining cognitive health. This paper investigates the causal impact of old age allowances on cognitive function among China's oldest-old. Exploiting a regression discontinuity design around old age allowance eligibility thresholds, we demonstrate that these allowances significantly enhance cognitive function. Our empirical analysis indicates that increased healthcare utilization and improvements in physical health are unlikely to be the primary mechanisms. We provide some evidence for the mechanisms that old age allowances increase food consumption, reduce labor participation, expand social engagement, strengthen personal relationships, and alleviate depressive symptoms.

Suggested Citation

  • Fang, Guanfu & Tang, Tianyu, 2025. "Old age allowances and cognitive function: A quasi-experimental study of China's oldest-old," Journal of Economic Behavior & Organization, Elsevier, vol. 240(C).
    • Handle: RePEc:eee:jeborg:v:240:y:2025:i:c:s0167268125004615
    DOI: 10.1016/j.jebo.2025.107344
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    Keywords

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    JEL classification:

    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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