Data: Our empirical analysis is based on 3 cross sections (2010-2012) of the General Household Survey (GHS). GHS is an annual nationally representative household survey conducted by Statistics South Africa. It covers six broad areas, namely education, health and social development, housing, household access to services and facilities, food security, and agriculture. For this study we use 6,261 households for males and 9,706 for females.
Methods: We estimate an ordered logit model. However, we note that the pension take-up profile shows that the probability of receiving the pension increases dramatically at the eligibility age for both males and females. While this is the case, not all those age-eligible to receive the pension do so, and there is also some slippage in pension receipt prior to the eligibility age. Therefore, in an attempt to control for these issues as well as the endogeneity problem, we instrument pension take-up with pension age-eligibility.
Results: We find positive effects on a select number of outcomes (food security for both adults and children); however, we note these effects are more associated with females, but not males. We attribute these findings to, among others, the idea that, due to labor force withdrawal upon pension eligibility, males' income, and consequently their share of income in the household does not improve with pension eligibility as observed in females. This, in turn, increases females' share of household income and bargaining power within the household. Another key finding is that pension receipt seems to have an influence on immediate household needs, such as food security, and not on long-term needs (items that need more initial investment), such as a source of drinking water or availability of toilet facilities.