Faced with a globally aging population, a growing body of literature has sought to better understand, measure and improve the wellbeing of older people (Horley and Lavery 1995; Smith et al. 2004). One of the key factors that have been shown to influence the wellbeing of older people is social capital. Social capital refers to the resources and value outcomes that are embedded in a person’s social network (Lin 2000). Like other forms of socio-economic capital, social capital is understood as an investment that can yield valuable returns for those who invest in building social networks (Lin and Erickson 2010). The research focussed on both developed and developing countries has shown that an increase in social isolation among many old people is due to a lack of social support and social connections and that this negatively affects their physical and mental wellbeing (see, e.g., Cornwell and Waite 2009; Gray 2009; Nilsson et al. 2006; Shadi et al. 2018). At the same time, it has been shown that social capital provides trusted social networks, social and emotional support and a sense of belongingness that has a positive effect on the physical and mental wellbeing of older people (see, e.g., Casey 2004; Forsman et al. 2013; Nyqvist et al. 2013).
As is the case for all other resources, not every individual or collective has the same level of social capital; some have more, or less, leading to social capital inequality. Ageing is an important individual-level antecedent contributing to social capital inequality (Lin 2000; Lin and Erickson 2010; Shadi et al. 2018). Following retirement, some people face a loss of important formal or organisational networks (Zhang and Zhang 2015). For others, kin, and non-kin-based, social networks may be reduced as family and friends pass away. Reduced mobility in old age also limits some older people’s ability to participate frequently in social activities. Considering the noted positive effects of social capital for individual and group wellbeing (Klein 2013; Helliwell 2007), one would expect that inequalities in social capital could have negative effects on wellbeing. This will be more pronounced if such social capital inequality is institutionalized with little room for upward mobility.
Older people are likely to experience more social capital inequality over time compared with other demographic groups, as their networks shrink with ageing. This inequality can be exacerbated because those of similar age will have different levels of social capital, depending on their baseline social networks at similar stages of their earlier life. Moreover, it is possible that an older person’s social capital might still be better than younger people, when the latter are embedded in disadvantaged social and institutional structures. For example, younger people living in extremely disadvantaged communities with increased violence, as well as those institutionalised in prisons and juvenile centres, and those from disadvantaged backgrounds like racial minorities are more likely to have lower and less beneficial, social capital than older people who do not have similar disadvantages (De Coster et al. 2006; Deuchar 2009).
What accounts for inequalities in social capital between generations and within groups of older people and how does it affect wellbeing? One main explanation offered in the literature is structural inequalities based on race, ethnicity, gender, caste, religion and socio-economic position (see e.g., Gray 2009; Nieminen et al. 2008). Men are known to have more non-kin social networks than women, and American whites have more resourceful social networks than blacks, even controlling for education and income levels (Lin 2000). Compared to the rich, the poor also have less formal and informal ties, access to valuable contacts and networks of reciprocity (Cleaver 2005). These structural differences are not just manifest at the individual or community level, but also at the macroeconomic level. For example, in post-socialist countries, such as Ukraine, levels of social capital are low, compared to more stable welfare states (Rostila 2013). Political institutions can play an instrumental role in the stratification of socio-economic inequalities (Freitag 2006). Noted examples include America’s Jim Crowe segregation policy and the apartheid system in South Africa, which, decades after their formal abolishment, have left a legacy of institutional inequality.
To the best of our knowledge, research has not examined how instances of social capital inequality among older people affect their wellbeing, especially when structurally supported by an institutional system that stratifies social inequalities. Our contribution is to better understand the comparative outcomes of wellbeing for older people who are institutionally segregated into clusters that produce uneven social capital. Using longitudinal data from the China Family Panel Studies (CFPS), we present the first study that examines how institutionalized social capital inequality, measured by the social capital gap generated by hukou (household registration) status in China, affects the wellbeing of older people.
Consistent with the existing literature, we use the level of individual involvement in social groups to measure social capital but in robustness checks, we also employ a measure of generalized trust (see, Awaworyi Churchill and Mishra 2017).
Our study contributes to at least two strands of literature. The first is those that have broadly examined the determinants of subjective wellbeing in China including other forms of inequality particularly, income inequality (see, e.g., Huang 2019; Jiang et al. 2012; Smyth and Qian 2008; Zhang and Awaworyi Churchill 2020). The second is studies that have focussed on the role of social capital in shaping various outcomes including wellbeing in China (see, e.g., Awaworyi Churchill and Mishra 2017; Wu et al. 2015; Yip et al. 2007).
These studies have enhanced our understanding about how disparities in income as well as social capital as a resource influence subjective wellbeing, however, they are less able to speak to how disparities in social capital (i.e., inequalities in social capital), entrenched in institutional policies, influence subjective wellbeing. We differ from the extant literature on the impact of social capital in that our focus is on understanding the effect of inequalities in social capital. Understanding the impact of social capital inequality is vital for informing policies designed to improve people’s economic and mental wellbeing (Cleaver 2005; Shadi et al. 2018).
China makes a particularly apt setting in which to investigate this issue for at least two reasons. First, China’s hukou system offers the opportunity to examine the lived consequences of institutional structures that create social inequalities and restrict upward mobility within social hierarchies. The hukou system provides an illustrative political-economic system that has created structural inequalities in terms of social capital for people in China (Liu 2005). Research has shown that people with urban hukou have better social networks and social support compared to people with rural hukou, with restricted rural-migration mobility resulting in reduced social capital mobility (Chan and Buckingham 2008; Cheng and Selden 1994; Liu et al. 2013). Chan and Buckingham (2008) argue that the urban-rural gap, which is well-documented for China, is linked to development strategies stemming from the 1950s when the Chinese government emphasized capital-intensive heavy industry in the urban sector by extracting agricultural resources and implemented the hukou system as a means to control the resources moving away from the agricultural sector. Over time, the hukou system became a formal means of institutionalising spatial hierarchization of rural-urban locations in the Chinese social system (Cheng and Selden 1994). As a mandatory system of registration, hukou is used to collect demographic and geographic information about Chinese citizens to formally record their identity, citizenship and social status. Through this system, the government has instituted administrative boundaries between the country’s rural and urban spaces, with urban spaces becoming the government’s responsibility. The government provides housing, transportation, education, jobs, food, water and medical facilities for city residents. Rural residents have, however, traditionally been largely left without, or with very little, state support and have had to provide these amenities for themselves. Strict regulations are maintained to control rural-urban mobility and people are often confined to the urban or rural hukou of their births. Rural migrants in urban areas are denied access to these state-provided amenities because they do not have formal urban hukou status (Chan and Buckingham 2008; Cheng and Selden 1994). Thus, the hukou system has created an institutionalised social capital inequality in China that gives little room for upward mobility (Chan and Buckingham 2008; Lu et al. 2013).
Second, China has one of the fastest ageing populations in the world (Norstrand and Xu 2011; Zhang and Zhang 2015). China has been experiencing a much more rapid ageing process than what occurred in developed countries. For example, it took China only 36 years for the proportion of the population aged 60 and above to increase from 7% to 14%, which is around one-third of the time taken in France (115 years) and half the time taken in Australia (73 years) and the US (69 years) (UN 2015). The UN predicts that by 2030, China will be one of the few upper-income-countries that is as aged as today’s high-income countries. Hence, it is important for policymakers, and other relevant stakeholders, to understand if, and how, institutionalized social capital inequalities like the hukou system affect the wellbeing of people as they age.