Land-Based Pensions and Rural Elderly Marginal Propensity to Consume: A Mixed-Methods Study from Jiangsu, China

This study investigates how Haimen’s land-based pension policy influences rural elderly financial behaviors and how demographic factors moderate their marginal propensity to consume (MPC). Utilizing a mixed-methods exploratory design with a sample of thirty-six participants, the research evaluates consumption responses, demographic heterogeneity, and savings motivations. The findings reveal a mean MPC of 34.7%, indicating a statistically significant positive consumption response that supports a partial Permanent Income Hypothesis (PIH) framework. Qualitative data show that spending is prioritized around a basic-needs-first hierarchy, primarily targeting food, medicine, and routine utilities, alongside modest quality-of-life enhancements. Ordinary least squares regression analysis demonstrates that the pension-to-prior-income ratio and number of dependents act as significant positive moderators of MPC, whereas age exhibits a significant negative relationship driven by habit persistence. Despite the permanent income annuity, precautionary saving remains dominant, with approximately 65% of pension income retained due to persistent structural healthcare risks and incomplete institutional safety nets. Ultimately, the study concludes that land financialization successfully relaxes daily liquidity constraints and reduces subsistence-level anxiety, but remains insufficient to replace private self-insurance in environments marked by persistent institutional healthcare gaps.