The Impact of Old Farmer Pension Program on Economic Behavior of Farm Households in Taiwan
Date Issued
2014
Date
2014
Author(s)
Chen, I-Chun
Abstract
The Farmer Health Insurance and the Old Farmer Pension Program are the major part of social welfare system for Taiwanese farmers. The goal of social welfare system is to maintain the health and increase the welfare of farmers and to promote the stability of rural areas. However, the social welfare system generates the deterioration of fiscal expenditure, and the old aged agricultural structure has been a serious problem. Therefore, how to maintain the social and economic wellbeing of the aged farmers has become an important policy issue. Recently a great deal of studies about Taiwanese farmers has devoted to the Farmer Health Insurance and the Old Farmer Pension Program. However, little attention has been paid to thoroughly understanding the current allocation of social insurance of Taiwanese farmers, and the effect of Old Farmer Pension Program on the on- and off-farm incomes and off-farm labor decisions of the young generations of the farm households. Thus, the major objective of this article is to provide an empirical assessment on these particular agricultural policy issue.
Using a unique dataset of 7,270 farm households which contains 7,270 principle farm operators and 10,918 young family members (excluding farm operator) aged 19-55 drawn from the Agricultural Household Survey in Taiwan in 2011, we adopt a Multinomial Logit Model, Recursive Mixed-Nonlinear Model, and Mixture Simultaneous Equation System to thoroughly understand the current allocation of social insurance of Taiwanese farmers, and to investigate the extent to which the receipts of the farm operator of the old pension payments on the off-farm labor supply decisions of the young family members aged 19-55 and on the on- and off-farm incomes. Results show that the number of of household members aged 15 or above, professional farm, total land area, and age of operator have positive effects on the likelihood of insuring the Farmer Health Insurance and receiving the old pension. Moreover, the lower education attainment of operator, the higher the likelihood of insuring the Farmer Health Insurance and receiving the old pension. Furthermore, the receipts of the old pension of the elderly farm operator have a significantly negative impact on the on- and off-farm incomes. This indicate that the relationship between Old Farmer Pension Program and the on- and off-farm incomes is not disconnect. In addition, our findings suggest that the receipts of the old pension of the elderly farm operator have a significant impact on young adults'' off-farm labor decision. The old farmer pension program significantly pushed young farm family member to the off-farm labor market, and the effect is more pronounced in non-farm service sector. Furthermore, among different age groups, this crowding-out effect is more significant for the family members aged between 46 and 55. This result provides a deep insight of the existing literature regarding the crowding out effect of public pension on other family members. In terms of policy perspective, government should design other programs to help young farm generation on the farm to balance the negative impacts of the Old Farmer Pension Program on farm succession. In conclusion, the government concerned should take the crowding-out effect into account when they adjusted the Old Farmer Pension Program, otherwise the loss of labor resource in agricultural sector and farm succession issues would become a serious problem.
Subjects
農業家庭
農場外勞動力供給
農民健康保險
老年農民福利津貼制度
臺灣
Type
thesis
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