Tae-Young Pak , University of Alabama
Non-contributory social pension has been widely used to provide basic income support for the elderly. Despite its effectiveness in reducing old-age poverty, little is known about the extent to which these welfare gains improve population health. In this study, we exploit a reform to the social pension program in South Korea to estimate the impact of unconditional cash transfer on physical and mental health. This reform represents one of the largest social welfare expansions in South Korean history and provides an excellent opportunity for natural experiment. Using data from the Korean Longitudinal Study of Aging, we find that the expansion is associated with 9.5-15.2% reductions in depressive symptoms, and that this effect operates mainly through increased satisfaction with financial condition and overall quality of life. For other health outcomes (physical health, cognitive health, and functional limitations), we find no evidence that the reform has had a health-preserving impact on beneficiaries.
Presented in Session 5. Health & Mortality 1