Social Capital and Healthy

Ageing in Indonesia

By

Junran Cao (UWA)

Anu Rammohan (UWA)

1

Relevance of Social Capital to

Health

• The ageing population

• What is social capital?

• Community participation

• Generalized trust

• How is social capital linked to elderly

health?

• Indonesia as a case study 2

Aim

• Identify the main social capital variables that

play a role in mitigating poor health

• Test the robustness of these social capital

variables across different health measures

3

Data

• From the Indonesian Family Life Survey East

conducted in 2012

• Restrict analyses to households with at least

one person aged 50 and above

• Sample size: 1226

• Dataset contains information on at the

individual, household and community level.

4

Measure of Health

• Self-assessed health status

• General health

• Health comparison to peers

• Expectation of future health

• Self-assessed mental health

• Chronic illness

• Katz index of Independence of Activities of

Daily Living (Katz ADLs) 5

Method

Our main equation of interest is:

ℎ𝑖𝑗𝑘∗ = 𝒙𝒊𝒋𝒌

′ 𝛽 + 𝒚𝒋𝒌′ 𝛾 + 𝒛𝒌

′ 𝜆 + 𝑢𝑖𝑗𝑘

• ℎ𝑖𝑗𝑘∗ : latent health status of individual i in

household j and community k

• 𝒙𝒊𝒋𝒌: individual characteristics

• 𝒚𝒋𝒌

: household variables

• 𝒛𝒌: community variables 6

Method

• Choice of ordered probit model

• In the case of the Katz ADLs,

ℎ𝑖𝑗𝑘 = 𝜂 ⟺ 𝜇𝜂−1 < ℎ𝑖𝑗𝑘∗ ≤ 𝜇𝜂

where, 𝜂 = Require assistance, Moderately

independent, Highly independent

& 𝜇’s are the threshold levels

7

Method

• It follows

𝑃𝑟𝑜𝑏 ℎ𝑖𝑗𝑘 = 𝜂 =

Φ 𝜇𝜂 − 𝒙𝒊𝒋𝒌′ 𝛽 + 𝒚𝒋𝒌

′ 𝛾 + 𝒛𝒌′ 𝜆 −

Φ 𝜇𝜂−1 − 𝒙𝒊𝒋𝒌′ 𝛽 + 𝒚𝒋𝒌

′ 𝛾 + 𝒛𝒌′ 𝜆

given that 𝑢𝑖𝑗𝑘~𝑁(0,1)

8

Method

• For reporting purposes, present marginal

effects: For some regressor 𝑥𝑟, 𝜕𝑃𝑟𝑜𝑏 ℎ𝑖𝑗𝑘 = 𝜂

𝜕𝑥𝑟=

𝜙 𝜇𝜂 − 𝒙𝒊𝒋𝒌′ 𝛽 + 𝒚

𝒋𝒌′ 𝛾 + 𝒛𝒌

′ 𝜆

−𝜙 𝜇𝜂−1 − 𝒙𝒊𝒋𝒌′ 𝛽 + 𝒚𝒋𝒌

′ 𝛾 + 𝒛𝒌′ 𝜆

× 𝛽𝑟

9

Results – Katz ADLs • Both measures of social capital are statistically

significant and positively correlated with the

probability of an individual being in the highly

independent category

Require

Assistance

Moderately

Independent

Highly

Independent

Generalised Trust -0.10***

(0.03)

-0.06***

(0.02)

0.16***

(0.05)

Community

Participation

-0.05***

(0.01)

-0.03***

(0.01)

0.08***

(0.02) 10

Results – Katz ADLs

• Other influential explanatory variables:

• Number of medical workers

• Elderly health centres

• Employment status

• Education attainment

11

Results – Katz ADLs

(Robustness test: Male-Female)

• Reasons to believe that effect on health is

gender-specific

Require

Assistance

Moderately

Independent

Highly

Independent

Female

Generalised Trust -0.17*** (0.05) -0.0003 0.19*** (0.06)

Community

Participation -0.07*** (0.02) -0.0001 0.08*** (0.03)

Male

Generalised Trust -0.01 (0.04) -0.01 (0.05) 0.01 (0.1)

Community

Participation -0.04*** (0.01) -0.05*** (0.02) 0.09*** (0.03) 12

Results – Katz ADLs

(Robustness test: Ages 60+)

• Increased importance of household size

• Effects of social capital consistent with

original Katz ADLs estimation

13

Results – Katz ADLs

(Robustness test: Urban-Rural)

• Role of medical workers

Require

Assistance

Moderately

Independent

Highly

Independent

Urban

Generalised Trust -0.03 (0.04) -0.05 (0.05) 0.08 (0.09)

Community Participation -0.04** (0.02) -0.05** (0.02) 0.09** (0.04)

Rural

Generalised Trust -0.14*** (0.04) -0.07*** (0.02) 0.20*** (0.06)

Community Participation -0.06*** (0.02) -0.03*** (0.01) 0.09*** (0.02) 14

Results – Other Health Measures

• Self-assessed health status

• Self-assessed mental health

• Chronic illness

• The contrasting effects of social capital with

respect to different health measures

15

Conclusion

• Access to better social capital is associated

with a higher degree of physical mobility,

independence and mental well-being among

elderly individuals

• Limited effects on more serious illnesses

• The role of social capital is generally

overlooked by the individuals themselves

16

Appendix - Endogeneity

• Question of causality: social capital may be

endogenous in that those who report poor

health may correspondingly be unable to

participate in community activities.

• Resort to IV regression

• Choice of IV – frequency of

violence/conflicts in the community

17

Appendix - Endogeneity

• Test for the presence of endogeneity using:

– The Wald test for dichotomous dependent

variables (SAHS 1-4 & Katz binary).

– Wooldridge’s test score and regression-based

F-test for continuous dependent variable (Katz

continuous).

• Insufficient evidence in our sample to reject

the null hypothesis that there is no

endogeneity. 18