ABSTRACT
The Old Farmer Pension Program (OFP) was implemented in 1995 to improve the quality of life and the well-being of elderly farmers in Taiwan. This chapter aims to the prevailing literature regarding the effect of a social pension program for older family members on the decisions of younger family members regarding their labor output. It seeks to measure the influence of the OFP program on family members' off-farm labor decisions. To examine the relationship between the OFP program and family members working off-farm, some econometric issues have to be considered. The chapter analyses a mixture simultaneous equation system to investigate the effects of the receipts of the OFP pension on the off-farm labor output decisions of the family members aged 19–55. The results show that socioeconomic characteristics, family and farm structure, and geographic position are significantly correlated with farm operators' participation in the OFP program.
