Does the basic pension reduce social isolation among older adults? Empirical evidence from South Korea.

This study examines the impact of South Korea's Basic Pension expansion in 2014 on social isolation, focusing on social connectedness, loneliness, and depressive symptoms among older adults. Using data from the Korean Longitudinal Study of Ageing (KLoSA), this study employs a Difference-in-Differences (DiD) approach combined with an Instrumental Variable (IV) strategy, which leverages the pension eligibility threshold at age 65 and the 2014 policy expansion. The results show that the pension expansion significantly reduced social isolation. After 2014, Basic Pension recipients reported more frequent social interactions, lower loneliness, and fewer depressive symptoms. The IV estimates confirm a causal relationship, suggesting that greater financial security facilitates social participation and alleviates loneliness and depression.