Previous studies show a decline in parent–child co-residence among the elderly. This study examined the effect of living away from adult children on upward intergenerational monetary transfers by analysing a 2006 survey of 19,947 persons aged 60 and above and selected from 20 provinces in China. Results indicate that elderly who were not co-residing but had at least one adult child living in another community/village within the city/county were likely to receive more intergenerational monetary transfers than those who were living with children. Living close to children, rather than co-residing with them, might be the primary living arrangement for older Chinese people in the foreseeable future. The findings have important programme and policy implications for countries such as China, which has the largest elderly population in the world. There is a strong need for the development of specific public care support systems focused on the elderly population, in general, and elderly in rural areas, in particular.

This article investigates the determinants of preference for intergenerational co-residence and examines the effects of living arrangement concordance (i.e.having a match between preference and reality) on the subjective wellbeing (SWB) of older Chinese. Data were derived from the China Health and Retirement Longitudinal Study (CHARLS) national baseline conducted in 2011. This allows for two different measures of the affective approach to SWB: depression and happiness. This article found living arrangement preference is indicative of need, cultural norms and current living arrangement experiences. The results support the hypothesis of discrepancy theories that having living arrangement concordance improves older parents’ SWB (i.e.depressive symptoms and happiness). In addition, the previously predictive effects of the actual living arrangement on SWB lost significance when actual living arrangement and concordance were added simultaneously. Living in a preferred arrangement appears to be more important than living in a traditional arrangement from the point of view of older adults’ SWB. Programmes designed to improve wellbeing in later life should not assume that there is a one-size-fits-all model for all; instead, older people should be given more choices of living arrangements.

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It is of vital importance to examine the relationship between pensions and household consumption/saving because this forms a link between social policy and economic development. Based on theories of absolute income, permanent income, and the life-cycle hypothesis, this paper constructs panel data models to investigate the effect of public pension participation and benefit level on household consumption. Evidence from the China Health and Retirement Longitudinal Study (CHARLS) 2011 and 2013 survey data shows that, compared with those not covered by any public pension program, individuals enrolled in the public pension system tend to consume more within respective income-quantile groups. Moreover, for the retired population, we found lower income groups have a higher marginal propensity to consume than higher income groups. In other words, lower income groups are likely to spend a higher proportion of any increase in pension benefit on consumption than higher income groups. To achieve a virtuous cycle between public pension, household consumption, and economic growth and, thus, a social-economically sustainable development, we suggest that China's pension system should be extended to cover all in the lowest income group, and the benefit level should be increased gradually to secure a stable expectation for the future and motivate current consumption.

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