V-Shaped Responsibility of China’s Social Welfare for the Elderly: Based on Analyzing Historical Evolution and Future Sustainability

Abstract

The aim of this study was to explore the evolution of aging support in China. The findings showed that (1) aging support from 1949–1977 emphasized the responsibility of the family and enterprises; (2) from 1978–2000, government and market responsibility emerged with the shift from a planned economy to a market-oriented economy; and (3) from 2001 onward, a development of social welfare for the elderly was undertaken by the government, but this includes a shared responsibility involving the market, society, family, and individuals. Based on these findings, the responsibility for aging support formed a dynamic V-shaped welfare evolution. This V-shaped welfare responsibility, especially in family support, is sustainable in China and other similar countries around the world.

1. Introduction

The total population of China was 542 million when the People’s Republic of China was founded in 1949. By 1959, the proportion of the elderly aged 65 and over in the total population was 3.85%. This proportion reached 7% (87 million) for the first time in 2000 and increased to 8.4% (119 million) and 10.64% (158 million) by 2010 and 2017, respectively [1], showing an obvious trend of accelerated growth in China’s aging population.

In response to the crisis of shortage in aging services due to the ageing population, China’s 13th Five-Year Plan (2016–2020) explores the possibilities of creating a long-term care insurance (LTCI) system, such as those implemented in the Netherlands, Germany, Japan, and Korea, which socialize the costs of long-term care services and medical treatments for the elderly. For thousands of years, China’s traditional elder care was based on the “feedback mode”, which required adult children and family members to be responsible for the care of their older parents [2]. Therefore, why did the government try to reformulate such an approach? The evolution in population structure and family formation has challenged the traditional intergenerational support model. As elder care evolved from being a responsibility of the family to a social risk, the government had to assume the responsibility for elder care. The change in China’s aging policy evolved along with those responsible for elder care.

Through literature analysis, historical analysis, and theory construction methods, the goal of this study was to examine how the responsibilities for supporting the elderly are divided and set in China. Section 3, related to the support for aging populations, is organized around the history of governmental policies, and Section 4 (construction of V-shaped responsibility theory) outlines how (family, government, market, society, and individual) responsibilities for elder care have changed since 1949. The curves represented by these five welfare providers, along with the different stages of China’s economic development, eventually formed a V-shaped framework of welfare responsibility. Based on the findings of the evolution of elderly welfare in China, the limitations of V-shaped responsibility theory and its applicability in some countries with different characteristics are discussed, and the potential implications for aging policy are explored.

2. Literature Review

We examined the literature on social policy to provide the basis for our analysis. Wilensky and Lebeaux (1965) divided social welfare into two categories that reflect the different philosophies of social policy and the roles of welfare states. The first category is the residual welfare model, which views the family and the market as responsible for the needs of a person or a family, and the government intervenes to fill the gaps when family and the market are proven inadequate. The second category is institutional welfare, which views the government as the undertaker of responsibility for citizen welfare [3]. For example, in Great Britain, the Beveridge Report (1958) considerably influenced the role of social welfare and the establishment of the post-war welfare state in Europe, where the responsibility lay with the government and the market [4]; the community played no role [5]. The idea fitted well with the economic and social conditions of the time; the level of industrialization was very low with unsound market development, and individual needs were satisfied by family, neighbors, community, and mutual assistance from religious organizations [6].

In today’s Great Britain, reductions in benefits and narrowed eligibility for accessing these benefits reflect a move away from institutional welfare, also occurring in Finland [7], toward a residual welfare state where the responsibility for the provision of social welfare is not the sole responsibility of the government, but a collective responsibility shared by three actors: the government, family, and the market. The collective responsibility between the three actors is also termed a “welfare triangle”. Even the choice in architectural design of an aged care facility is closely related to the health and wellbeing of the elderly [8]. This shows that the government’s concern for the welfare of the elderly is more micro-level. In today’s welfare states, a country’s gross domestic product (GDP) spent on social welfare is viewed as the sum of social welfare produced by the family, market transactions, and the government [9]. Each level of government—federal, state, and local—plays a different role in the supply of social welfare [10]. Empirical research has proven that the management of government and organizations in welfare supply reduces welfare dependency behaviors [11,12]. Abrahamson (1994) and Duffy (1998) stated that the government, the market, and civil society are responsible for social welfare and emphasized substituting the function of civil society for family responsibility [13,14]. Titmuss (1974) also stated that individual responsibility was necessary [15]. In this way, the welfare triangle evolved into the “welfare quadrangle” including family, market, government, and the individual. Other than the welfare quadrangle, Johnson (1987) and Evers (1988) emphasized the key role of civil society, and especially that of volunteer organizations, in welfare provision [16,17]. However, the responsibilities for planning elder care capacities are jointly met by central and non-central authorities in most European Union (EU) countries [18]. Relevant historical, economic, demographic, and political factors are influencing the transformation of social care services for the elderly [19].

In relation to China’s transition from an agricultural society to an industrial society and from a planned economy to a market economy, Wilensky and LeBeaux’s model of examining the welfare state—based on the role of the government, family, and the market—is effective [3]. Lei and Wang (2016) considered that the successful improvement of social welfare should be based on welfare pluralism [20]. In other words, China should be built based on multi-layer providers primarily supported by an efficient government, developed market, powerful social organizations, harmonious family, and responsible individuals [21]. However, Jing (2006) suggested that China’s social welfare lacks a theoretical basis and distinct boundaries of responsibilities for social welfare. In China’s fiscal expenditure, social welfare has an irrational structure and proportion [22]. Scholars think that the gradual decrease in the central government’s responsibility for social welfare after the 1980s and the influence of the urban-rural household register system from 1955 resulted in a fragmented structure of social welfare by region [23], which also created a mismatch between economic development, social progress, and social justice [24].

On the basis of foreign research, most of the Chinese scholars indicate that China’s responsibility for social welfare is a “responsibility package”, which is shared amongst the family, market, government, and the individual. However, the studies lack periodic analysis and remain ambiguous on the issue of who is responsible or who should be responsible for the provision of social welfare. Some researchers argued that existing comparative analyses of welfare states and regimes are based on flawed assumptions that countries have similar approaches to social welfare provision and that a country’s social values and principles do not influence policy developments. Kasza (2002) asserted that significant variations exist across different areas of social provision in different countries due to the diversity in internal policy; thus, research on welfare states and regimes requires a careful examination of the country’s historical foundation, political discrepancy, and evolution of policy [25].

This paper provides an argument that a comprehensive analysis of China’s social welfare provision is warranted that focuses on China’s historical development, values, and principles. Based on welfare pluralism and the traditional Confucian culture in China, which does not fully correspond to the welfare responsibilities of families, markets, states, and individuals in Western countries, Chinese families have assumed the main responsibility during different historical periods in providing for the aged. Therefore, the roles of the government, family, the market, and the individual were examined to clarify how the responsibilities of China’s social welfare provision evolved chronologically, and the author further explored how the V-shaped welfare responsibility, especially in family support, will be sustainable throughout different stages of China’s economic development.

3. Historical Development of China’s Aging Policy

China’s aging policy developed from 1949–2017. The policies discussed are provided in Appendix A.

3.1. 1949–1977: Early Development of Modern China’s Aging Policy

Traditionally, China’s Confucian culture is a social aggregation of rite and law. One of the well-known principles is filial piety. According to the historical records, filial piety has been written into law since the Han Dynasty. Based on this law, Chinese parents observe the rules of bringing up their children so that they would grow up to care for them in their old age [26]. “Impiety is the top felony in the five chief forms of criminal punishment” (The Classic of Filial Piety-Five Punishments) and “Unfilial persons should be beheaded” (Spring and Autumn-Gongyang Biography-Wen Duke 16th year) were important laws in the Han Dynasty. This legal principle has survived the Tang, Song, Ming, and Qing dynasties, up to the present. Adult children are duty bound to support their parents by providing them with the basic necessities of life, medical treatment, mental comfort, and burial. This mutual dependency favored the social continuity and cooperation of family members over generations [26].

With the founding of the People’s Republic of China (PRC) in 1949, the idea of the government taking care of workers and their families began to emerge. As the government implemented a planned economic system, a labor insurance fund for workers was set up. In 1951, the Government Administration Council (GAC) introduced the Labor Insurance Regulation of PRC, which stipulated that state-owned enterprises, joint state-private enterprises, government-sponsored institutions, government organizations, and mass organizations must pay into the labor insurance fund. In 1958, the State Council issued the Interim Provision for Treatment of Retired Workers and Clerks and Interim Provision for Treatment of Workers and Clerks after Quitting Working (draft), which stated that all enterprises and mass organizations must care for their workers and clerks in old age or those with disabilities and stipulated that the pension allowance shall be paid by the enterprise based on the labor insurance system.

The role of the labor insurance fund became increasingly important soon after its implementation. The year following its implementation, the country suffered prolonged natural disasters that extended over three years (1959–1961). During that time, the living standard of retired employees was extremely low, and the central government issued the Notice about the Solution to the Relief for Retired Enterprise Employees Living in Poverty in 1964. If retired employees who had received relief from civil administrations were still living in poverty, then the local union organizations from their former employment could provide a subsidy from their labor insurance funds to sustain their poor retirees.

By 1969, the central government decided that state-owned enterprises should no longer use the labor insurance funds to pay for salaries and expenses related to the protection of their retirees and persons with disabilities. The Ministry of Finance issued the Opinion on Reform of Several Systems in Finance Services in State-Owned Enterprises (draft), where the enterprises should assume the responsibility for their workers and not the government. Therefore, the labor insurance that reflected the government and the enterprises’ shared responsibility of caring for workers was reduced to “enterprise insurance” entirely undertaken by the enterprises.

Instead, the government assumed the responsibility of providing free medical service for their public servants and meeting the most basic needs of the childless elderly. Providing social welfare for the childless elderly and other vulnerable populations differed between urban and rural settings; in urban settings, many care institutions and nursing homes were built and created for the elderly. The number of the elderly admitted to social welfare institutions grew annually until the Great Cultural Revolution (1966–1976), during which the number of childless elderly and widows and widowers admitted to these institutions fell in 1978 to half the number in 1964 [27,28]. In rural areas, social welfare for vulnerable elderly was labeled “Three-No Elderly”, which meant the elderly with no relatives, no income, and unable to work, and was characterized as a collective welfare system. In 1956, the agricultural cooperative made arrangements for and took care of the elderly, childless adults, widowers, persons with disabilities, and other members at risk who lacked the labor capability to supply themselves with adequate food, clothing, and firewood. Some areas set up nursing homes to support these people with “Give Guarantees”, which consisted of the provision of food, clothing, firewood, and education for children and juveniles, and burials for the dead elderly. Like the urban areas, rural welfare for the elderly almost stopped during the Great Cultural Revolution.

In summary, the fundamental responsibility of families to support their old parents still existed during this period, but the care of the elderly was also shared by enterprises and the government. Enterprises provided social welfare for retired workers, and the government assumed the fiscal responsibility for institutionalized elders. Approaches to provisions of social welfare differed for the urban and rural elderly, and the benefit levels also diverged due to the different identities of farmers and citizens. As a whole, the urban level is higher than the rural one.

3.2. 1978–2000: Growth of Social Welfare for the Elderly in the Market Reform Period

From the late 1970s to the beginning of the 1980s, the Chinese economy and society underwent a reform: China moved from a centralized planned economy to a more market-oriented economy and established a one-child policy to reduce the birth rate and slow the population growth. The former gradually caused “hidden unemployment” to become “explicit unemployment” in urban and rural areas, and the latter gradually reduced the family size, where the number of family members per household decreased from 4.4 persons in 1982 to 3.4 persons in 2000 [29]. The appearance of leaving rural areas for urban employment of family members, the disappearance of the traditional large family, and the increase in average life expectancy and chronic disease caused the traditional family support system for the elderly to fall apart [30]. Weakening of the family’s capability to support their aging parents resulted in the unavailability of care or spiritual consolation for the elderly in both urban and rural areas, but this effect was worse in rural areas. However, the principal responsibility for the elderly continued to remain with the family and was written into law. The Law on Protection of Rights and Interests of the Elderly of PRC enacted in 1996 stated that the elderly should primarily depend on their family for care. An article in the Constitution written in 1982 also stated that adult children were duty bound to support their parents, which remained unchanged until the Constitution was revised in 1999.

In 1984, China entered into a period of market system reform with a focus on revitalizing enterprises. Accordingly, enterprises were to focus on increasing efficiency, and as a result, they were no longer able to assume responsibility for all things related to their workers’ welfare. Workers were required to pay into the social pension insurance under the labor contract system; the source of the retirement pension should be paid by enterprises and workers; and if retirement pensions were insufficient, then the government subsidized them to a certain extent. Medical treatments and housing arrangements for the elderly were gradually separated from the responsibility of the enterprise and were incorporated into social welfare.

As the enterprises shifted away from having the responsibility of their workers’ welfare and instead dedicated their efforts to increasing economic growth toward the establishment of a modernized market economy, the government then assumed the provision of these benefits. In 1982, the fifth session of the Fifth National People’s Congress (NPC) passed a law that reiterated that citizens who are old, sick, or disabled should have the right to obtain in-kind support from the government and society and that the nation should ensure social insurance, social relief, and medical undertakings for citizens to enjoy these rights.

Next, the government moved forward quickly toward welfare pluralism. In 1986, the Second Five-Year Plan (1986–1990) prepared by the Ministry of Civil Affairs stated that the responsibility for the reform and development of social welfare undertakings should be changed from being borne by the government to being a combination of the state, the collective, and the individual to achieve the transition from relief-oriented welfare to welfare-oriented support. In 1994, the State Council issued a statement that families should support the elderly and persons with disabilities who were unable to work and that the expenses were to be disbursed from the village reserve or funds for public social welfare. In areas with this system of collective operation, the expenses were to be disbursed from the income from the collective and the profit from collective-owned enterprises. However, enterprises and the individual families were unable to respond to the government’s demand. With the increasing financial difficulties experienced by enterprises and the individuals, the government needed to play a fundamental role in the provision of social welfare.

Socialization of welfare occurred by adding a market-oriented welfare system based on existing enterprise welfare, fiscal welfare, and civil welfare through two processes: the market-oriented fundraising and the market-oriented supply of services. Regarding the former, in June 1987, the China Social Welfare Lottery Committee for Raising Funds issued the Regulation on China Social Welfare Lottery Committee for Raising Funds and the Proposed Method for Social Welfare Lottery Issuance. The Law on Donation for Public Welfare Undertaking of the PRC was issued in 1999 to standardize and stimulate social donations and support for various social welfare undertakings. For the latter, the General Office of the State Council endorsed the Opinion on Acceleration of Social Welfare Socialization in 2000, which was prepared by 11 ministries and commissions including the Ministry of Civil Affairs. The Opinion provided the policy orientation for the socialization of funding resources, service objects, staff teams, and management systems in the development of the social welfare system. Gradually, it established a market economy system for social welfare. As an important component of the entire social welfare, the welfare provision for the elderly would be influenced by social welfare policy in terms of the direction of its development.

3.3. 2001 to the Present: Welfare Pluralism in China’s Aging Society

Statistical results from the Fifth National Population Census showed that China had an aging society at the turn of the millennium. To tackle the aging population issue, the State Council established an aging support system based on family support and dependence on community services in 2000. The following year, the State Council introduced the 10th Five-Year Plan Outline for Aging Undertaking in China (2001–2005), reiterating the adherence to the integration of family and social support systems for the elderly in urban and rural areas, where aging farmers were to be supported mainly by their families.

In 2005, the Ministry of Civil Affairs implemented a social welfare service system for the elderly based on three tiers that, for the first time, consisted of support from the family, community services, and institutions. Thereafter, the fundamental role of family in elder care was confirmed by many other important policies and documents. Some policies for institutional care were amended. For example, institutions were considered a mainstay during the period of the 10th Five-Year Plan (2001–2005) of China’s national economic and social development, but the government restricted its role to a more supplementary position in the 11th Five-Year Plan (2006–2010). Then, during the 12th Five-Year Plan (2011–2015), the government was stated to be in a supportive position of elderly care and then finally returned to being in a supplementary position in the 13th Five-Year Plan (2016–2020). However, even after these adjustments, the policy on the family’s role in elder care remained unchanged in principle; families still retained the bulk of responsibilities for their older family members.

Although the government has been emphasizing the role of families as a primary source of care for the elderly, the government has issued a number of policies and documents on social welfare for the elderly and adopted active measures in succession.

First, urban and rural areas were to be developed simultaneously to speed up the building of basic institutions for the elderly. In 2001, the Ministry of Civil Affairs issued the Star Plan for Elderly Welfare and Service in Community [31], which determined that most of the social welfare funds raised by lottery by the central government were to be given to local governments for the building of social welfare service facilities and catered to the need to establish places that encouraged the social participation of the elderly in urban areas and nursing homes in rural areas within two to three years. This was the first large-scale and all-encompassing governmental action to encourage the building of basic facilities for the elderly in communities in both urban and rural areas.

Second, poverty relief for the elderly and an elderly allowance system were established. The Law on the Protection of Rights and Interests of the Elderly of the PRC, introduced in 2012, encouraged local governments to establish an elderly allowance system for low-income elderly aged 80 years and above and required the establishment of a subsidy system for poor elderly with dementia or with disabilities. The fund for this allowance and subsidy was borne by local finance and included in the annual fiscal budget. By the end of 2016, the elderly allowance system was established in 19 provinces, the subsidy system for supporting the poor elderly was established in 23 provinces, and the care subsidy system for the elderly with disabilities was established in four provinces in China.

Since the reform and opening the doors to the outside world, non-governmental capital has been increasingly invested in China, especially in the 2000s. For-profit and nonprofit private capital including foreign investors, called non-governmental capital, can participate in China’s public services by means of bidding cooperation, joint ventures, and holding shares. The government has encouraged non-governmental capital to be invested in the provision of aging services, disability rehabilitation, and nursing services. With the constant increase in demand for aging-related services in China, foreign investors have been creating new aging-related services in China with the cooperation of Chinese corporations, enterprises, and other economic organizations. Non-governmental capital was also directed toward project-oriented operations to extend enterprise projects to the field of aging services. In response, preferential policies on investment and financing, as well as taxes and dues were created for private and nonprofit organizations.

To further reinforce and improve the charitable work and better secure the livelihoods of elderly people in poverty, the State Council stated in the 12th Five-Year Plan that volunteer service teams for the elderly should be supported and encouraged, and charitable organizations and other institutions and individuals were asked to offer them in-kind support. This led to the establishment of nonprofit institutions and facilities for medical treatment, education, and rehabilitation for persons with disabilities by donation, volunteer service, and the establishment of foundations. The central government also supported the construction of nursing homes in central and western rural areas using the public welfare fund from the lottery. For the enterprises and social welfare and charitable organizations that provided aging-related services, a special loan was provisioned by the Ministry of Civil Affairs and the State Development Bank to sustain their work.

Traditional enterprise welfare in the Chinese planned economic era is still attractive to the elderly. However, in recent years, the shift toward market-oriented and society-oriented social welfare has been rapid. Except for the poor and “Three-No” older adults who enjoy free social welfare offered by the state, paid services are growing, and more emphasis is being placed on the individual responsibility of family members to arrange the services needed for their older parents. However, especially in rural areas, the government policies strongly require families to assume the responsibility for providing care.

In recent years, long-term care insurance policies on the elderly with disabilities have been introduced into a pilot project in Tsingtao, Changchun, and Nantong in succession after the implementation of the Guiding Opinions on Trial Implementation of Long Term Care Insurance Policy in 2016. Expenses for care services and medical care for beneficiaries with disabilities are to be paid out-of-pocket and with government subsidies. This means that the beneficiaries also bear the cost of the services. With the expansion and set of LTCI, we predicted that the individual’s responsibility will be further enhanced in the future.

4. Construction of V-Shaped Responsibility Theory in the Evolution of China’s Aging Policy

The evolution of China’s aging policy showed different risks for the elderly and different responsibilities for elder care, which emerged in accordance with the different stages of economic development after the founding of the People’s Republic of China. Based on this relationship among them, a theoretical framework was developed.

4.1. Initial Formation of V-Shaped Responsibility

In Figure 1, R is the assumed line of risk for supporting the elderly, which indicates that the social risk for supporting them increases with the improvement in the stages of economic development. The R curve has no influence on our findings. The ι curves indicate the percentage of responsibilities by the different sectors. Curve ι1 indicates the family’s responsibility, which demonstrates their highest responsibility, followed by curves ι2, ι3, ι4, and ι5, which are the government’s, market’s, society’s (public charity), and individual’s responsibilities, respectively.

V-shaped zones formed by the transverse crossing of curve ι indicate two points. First, the percentage of responsibility of the two curves ι was confirmed, with curve ι indicating a larger percentage at the upper position and the responsibility of family, government, market, society, and individual, successively. Second, the larger V-shaped zone is in the area where the wider opening should be. Therefore, the responsibility deviation crossed by the two curves increased.

In the first place, zone V1 comes into being. Prior to the establishment of the PRC, the family was the primary and only source for providing aging support, while the government’s role was limited to sporadic social relief. After 1949, China was in the pre-industrialization stage. The newly-built government paid more attention to the poor elderly in urban and rural areas and only provided support for their basic needs. Curves ι1 and ι2 approach each other in 1976, reflecting the suspension of the role played by the Ministry of Civil Affairs in the development of social welfare for the elderly due to three years of natural disasters and political campaigns throughout the nation during the Great Cultural Revolution from 1966–1976. That meant that the government’s responsibilities were almost none, leaving only family responsibilities. Curves ι1 and ι2 create the first zone, V1, for social welfare responsibility.

In the second place, zone V2 emerges. From the beginning of the 1980s, China underwent economic reform and opened up to the outside world by the first decade in the 21st Century, having achieved an abundant accumulation of national wealth. Regarding social welfare for the elderly, family support faced challenges to a certain extent, but the legal responsibility of families for elder care increased. Under the heavy pressure from the aging population, the government’s responsibility for the elderly also increased significantly, resulting in zone V2 created by ι1 and ι2.

In the third place, zone V3 emerges. Early in the 1980s, the establishment of the market economy system was a prelude to market-oriented social welfare, which was embodied in the fundraising efforts using the welfare lottery system and private capital for supporting aging-related services in China. The traditional culture of mutual assistance including public welfare and charity still existed, but played a minor role and was on the decline. In the 12th Five-Year Plan (2011–2015), volunteerism and charity services for the elderly were promoted by the government. The V-shaped profile crossed by ι3Sι4 is zone KSO (V3), which reflects the emergence of the market and societal roles in providing aging support and becoming a part of the social welfare system for the elderly. The social role was less than that of the market in elderly welfare provision, but relevant policies and rules improved systematically thereafter.

In the fourth place, zone V4 is highlighted. In the middle and late 1980s, the endowment insurance system, called the “integration of overall social pooling with individual account”, was paid by the enterprises, individuals, and the government, but individuals still struggled to shoulder the responsibility due to the harsh consequences of the government’s reform of state-owned enterprises. By 2000, individuals’ contribution to social welfare improved, which led to the pilot and promotion of long-term care insurance (LTCI) systems in 2016, which required individuals to cover the payments for elderly services. In Figure 1, curve ι5 slants upward to the right, indicating the individual’s responsibility (ι5) exceeding social responsibility (ι4) and generating the SMP zone (V4) as ι4 and ι5 cross each other.

4.2. Possible Future Trends in V-Shaped Responsibility

Based on the general tendency of traditional cultures, stages of economic development, and improvements in people’s living standards in China, as well as the global development of social welfare, the V-shaped evolution in the responsibility of aging-related support is likely to show the following trends in the next 10 years.

Firstly, the opening of zone V2 is broadening. It is unimaginable that the family’s responsibility for elder care will completely disappear given the strong influence of filial piety. However, curve ι1 is not likely to rise without limit because it is difficult for a family to take on all the responsibility for aging support against the background of the rapidly-aging population, industrialization, and urbanization. Therefore, curve ι1 is likely to extend in a smooth and stable way. Curve ι2 indicates that the government’s responsibility is increasing, but it is likely to decrease in the following years based on the condition of economic distress, for which economic growth continued to decline relative to the period before 2012. Given the idea of “big society, small government” prevailing worldwide, curve ι₂ has a tendency to move downward gradually over long periods. In that case, the opening of the zone V2 formed by curve ι1 and curve ι2 may broaden in the long term.

Secondly, the opening of zone KSO (V3) will extend along the direction to the top right. Market-oriented social welfare in aging is only in its infancy in China. Profit-making enterprises and nonprofit enterprises will play important roles in the aging service system in the future. We foresee that curve ι3 will rise rightward at a faster rate, likely to cross curve ι2 at some time, and will form a new V-shaped zone. However, excluding the social welfare loss caused by the inconsistency between the government and these organizations is difficult [32]. If so, curve ι3 may rise at a slower pace. As the societal role for aging support increases, especially in the report of the 19th National Congress of the Communist Party of China, the social environment of respecting the elderly, filial piety, and respect for the elderly should form in the whole society, so curve ι4 will show a tendency to extend along the direction toward the top right, but we anticipate that it will not cross curve ι3 based on the fundamental responsibility of the market and the supplementary role of public charity in supporting the elderly against the background of global welfare pluralism.

Thirdly, new V-shaped zones will be added. The recent increasing of the individual’s responsibility for social welfare is underway and will influence the traditional Chinese aging support system. The family and government should not assume all the responsibility for the welfare of the elderly, but the government and society will need to aid individuals to be able to contribute to their own welfare [33]. The welfare of the elderly should be a formal proactive institutional arrangement for all the elderly in the future, rather than today’s remedial-oriented system. Given China’s large population, to develop a welfare system sustainably for the elderly, individual citizens must bear the corresponding responsibility.

Therefore, curve ι5 may extend along the direction to the top right in the near future, crossing curves ι4 and ι3 in succession. Then, a new V-shaped zone V5 (QMO) would be formed by crossing ι4, and zones V6 (SNP) and V7 (QNK) would be formed by crossing ι3. Zones V4 and V5 indicate the stages where individual responsibility is lower and higher than social responsibility, respectively, whereas zones V6 and V7 indicate the stages where the individual’s responsibility is lower and higher than the market’s responsibility, respectively. As time passes, curve ι5 is more likely to cross curve ι2, which means that the government’s responsibility for the elderly will be considered the last line of defense.

5. Discussion

Sound social policy should be based on scientific research while considering social values and principles [34]. Our examination of China’s aging policy clarified how its evolution was shaped by the historical development, values, and principles, as evident by the division of responsibilities by the various sectors. The trend in curve ι indicates that the five sectors will most likely show no reversion, but the components of social welfare for the elderly will change somewhat in the coming years. Hence, the V-shaped social welfare responsibility theory should be subject to further study as the transformation of economies and social structures continues. Notably, there are some limitations in this study.

First, due to the lack of expenditure statistical data from family, state, market, society, and individuals in the entire elderly welfare system, it is impossible to simulate the opening size of each V-shaped responsibility area accurately. It is too difficult to measure the contribution percentage of each V-shaped region to the construction of the elderly welfare system. In theory, the smaller the opening of the V-shaped area, the smaller the V-shaped area and the higher the contribution of the two responsible sectors constituting the V-shaped area.

Second, there is no clear division of government responsibility. Government responsibility can be divided amongst the central and local governments. Especially since 1994, Chinese government finance has been separated from central government finance and local government finance. In the process of the construction of the welfare system for the elderly, this separation has manifested in the assistance from the central government to the poor elderly in urban and rural areas and the financial support for public elder care institutions, whereas local government supports counterpart funding and funding from private welfare institutions. Considerable differences in financial responsibility exist between them, but no further distinction is possible with V-shaped responsibility theory.

Third, the applicability and sustainability of V-shaped responsibility theory should be analyzed concretely. In developing countries with similar Confucian cultural and economic levels, if the political structure is different, then the responsibility of the relevant sectors may be different, and the structure of the V-shaped region will be different. However, in other countries with different cultures or economic levels or different political systems, the proportion of the main body of responsibility must be different, and whether the area of responsibility is V-shaped or not is uncertain. As far as the eastern, central, and western regions of China are concerned, although the cultural traditions and political structure are the same, a large gap exists in the levels of economic development between these areas, and the size of the V-shaped responsibility areas for elderly welfare differs in different regions. However, the main sectors of responsibility forming the V-shaped zone should be the same, meaning the V-shaped welfare responsibility should be sustainable.

6. Conclusions

This article provided an analysis of the evolution of social welfare for the elderly in China, and we discussed its development from the establishment of the PRC to the present during three distinct periods. We characterized the evolution of aging-related care using the changing responsibilities for the provision of aging support by various sectors. As depicted in the V-shaped theory, we argued that these changing responsibilities for aging support assumed by the family, government, market, society, and individuals are highly affected by China’s historical development, values, and principles.

First, given the advancements in industrialization and transition in social structures, families are experiencing difficulties when assuming total responsibility for their older family members. However, the family system offers a solid basis for the development of culture and civilization. Anyone can leave their job, but they cannot leave the care service and emotional comfort of their families [35]. Families, as the main source of care for the elderly, are under tremendous pressure. Women, especially adult daughters, bear a disproportionate share of the burden of parental care [36]. Similarly, even as Chinese society moves toward post-industrialization, the family will continue to play a major role in providing support for their older family members.

Second, government responsibility for the elderly has changed from securing the basic needs of the elderly during the planned-economy age to securing all-round aging services including daily care, rehabilitation of chronic diseases, health maintenance, and spiritual comfort in today’s market-oriented economy. Besides building public nursing homes maintaining basic fairness, all levels of government have been building a multi-valued aging support system [37], reflected by public goods for the poor, quasi-public goods for the low-income, and private products for the middle-income and above.

Third, the market’s responsibility has played an increasingly visible role in providing aging support in China. Nonprofit and profit capital have been increasingly involved in the aging services field, characterized by public-private partnerships, programs run by local entities and subsidized by the state, and private sole proprietorships, which cater to the trend of global welfare reform of “small government, big society”. The government will need to regulate the rising hidden costs of these service organizations; otherwise, claimants cannot apply for welfare benefits, resulting in administrative exclusion [38].

Fourth, societal response to aging support has been mainly led by the government. Since 2001, the government at all levels has increasingly recognized the function of volunteerism and mutual assistance programs in strengthening social capital through social policies, regulations, and administrative support [39]. Many challenges remain in mobilizing the social forces for these community initiatives, not just the government. We foresee that the societal role in providing aging support, influenced by the traditional Chinese Confucian culture of the mean which mutual assistance is limited to intergenerational and consanguineous relationships [40], will penetrate slowly and deeply.

Finally, in traditional China, the individual was shadowed by the large influence of the family. An individual was most likely to be completely dependent on their parents from birth, so they then played the role in taking on the filial responsibility to support their aging parents [26]. Therefore, the individual’s responsibility and the family’s responsibility were almost always integrated. Currently, the individual’s responsibility is embodied in paid aging services and the contribution to long-term care insurance. In the long run, the individual’s responsibility for the elderly may be more likely to prevail in China, which will achieve individual self-responsibility and make people more powerful actors in the market [41].