Internet Usage, Government Trust, and Participation of Informal Workers in Employee Public Pension Scheme

Abstract

Incorporating more informal workers into the employee public pension scheme (EPPS) is a crucial component of building a high-quality employment security system in China. This study, based on data from the China Family Panel Studies (CFPS) for the years 2014, 2016, and 2018, empirically analyzes the impact of Internet usage on the participation of informal workers in the EPPS. The research finds that informal workers significantly increase the possibility of participation in the EPPS through the Internet usage. This positive effect remains significant even after a series of robustness tests. Heterogeneity analyses argue that informal workers with higher educational level are more likely to participate in employee public pension scheme through the Internet Usage than informal workers with lower educational level. Mechanism analysis suggests that informal workers significantly raise their government trust through the Internet usage, thereby promoting their participation in the EPPS. Based on the empirical results, the following policy recommendations are proposed: government should further utilize the Internet to streamline online enrollment procedures, reducing the time costs for informal workers to participate in the EPPS. Additionally, the government should actively engage with the public through the Internet to enhance its image and deepen the level of government trust of informal workers, thereby increasing their motivation to participate in the EPPS.