A Study On The Effect Of Social Security System On Human Capital And Economic Growth

China has made great achievements in economic development, attracting worldwide attention since the reform and opening-up. With the development of economy and aging population, our economic growth model that relied on cheap labor could not be sustainable. Therefore, we need search for new sources of economic growth. From the perspective of new economic growth theory, strengthening human capital accumulation and improving the labor quality instead of quantity advantage are not only beneficial to technology progress, but also to the adjustment of Economic Structure, which ultimately promote economic growth.From the perspective of social security, this paper analyzes the relationship between social security system, human capital accumulation and economic growth in the theoretical framework of an overlapping generation endogenous growth model, on the basis of which the triadic relation is straightened out from the perspective of co-integration theory and VAR model through empirical analyses. Several primary sections are included in the paper.Firstly, the dissertation discusses the mechanisms of social security system in human capital accumulation. The effects of social security system on human capital accumulation are manifested in two aspects:educational investment and non-educational investment. The former includes school education, training, and learning by doing, the latter includes migration of human capital and health care. Social security system will influence favorably human capital accumulation in the due course by influencing these factors.Secondly, the dissertation analyzes the impact of social security system on educational investment, which will eventually influence human capital accumulation, through fertility rate and retirement. In terms of fertility rate, what role pay-as-you-go and funded social security system play on human capital accumulation on the premises of altruism and bequests are discussed in this part. Under pay-as-you-go social security system, without bequests, the pension contribution rate varied inversely with fertility rate besides the case of intergeneration altruism, in which the relation was uncertain. Raising the pension contribution rate will enhance fertility rate in the case of parental altruism with bequests. Under funded security system, the pension contribution rate has nothing to do with fertility rate in the case of parental altruism without bequests. As for retirement, it is studied that how social security system of different types influence retirement in a concrete and an abstract utility functions. Under whatever social security system, increasing social security contribution rate would stimulate early retirement and be bad for human capital accumulation when utility functions is concretized.Thirdly, the dissertation makes a comparative analysis on the impact of definite contribution social security system with definite benefits social security system and earnings-related benefits with flat-rate benefits on human capital migration. Definite contribution social security system would encourage the labor force to migrate. Higher expected social security benefits of the country with flat-rate benefits would attract the labor to settle in, The possibility of emigration boosts investments in human capital in the country with flat-rate benefits. In addition, on the base of our social security situations, what influence the reform of social security system exert on human capital migration and health care is discussed through quantitative analyses. The findings indicate the development of social security is beneficial to human capital migration and health care on the one hand, on the other hand, the problems and defects in our social security system impede the development of human capital migration and health care.Fourthly, in the framework of a steady state growth, with overlapping generations, this article theoretically discusses the impact of social security system on educational investment and economic growth. Under the pay-as-you-go system, social security contribution rate may handicap human capital accumulation and economic growth from a savings or human capital point of view. Under the funded system, the contribution rate is good for human capital investment and economic growth without the impact of savings. Under the partial funded system, whether social pool or Individual Account rate have a positive effect on human capital accumulation depends on output contribution rate of substance capital and tax rate of income, which varies inversely with economic growth.Lastly, by virtue of VAR model, co-integrated test, impulse responses function and variance decomposition methods, the paper has empirical analyses on the relation of three factors, some which are in agreement with the theoretical findings-Raising the level of social security is beneficial to human capital accumulation; external shocks on certain factor will bring some variations to human capital accumulation and economic growth, which maybe positive or negative. On the base of the theoretical and empirical conclusions, the paper makes some suggestions and proposals on Chinese social security system, such as improving social security benefits, lowering social security contribution rate, reducing the regional disparity, raising social security level, perfecting health insurance system.