Digital inclusive finance and total factor productivity in agriculture—— Evidence from China

Abstract

Under the strategy of rural revitalization, the development of digital inclusive finance is an effective way to alleviate the long-standing problem of "difficult and expensive financing" in the "three rural areas", and is an inherent requirement for achieving high-quality development of Chinese agriculture. Based on the panel data of Chinese provinces from 2011 to 2021, this paper adopts a three-stage SBM-DEA model to measure the total factor productivity of agriculture and analyzes the impact of digital financial inclusion on total factor productivity of agriculture. The study shows that, firstly, the development of digital inclusive finance plays a more significant role in enhancing total factor productivity in agriculture, and the depth of use plays the strongest contributing role among the sub-indicators. Second, there is heterogeneity in the effects of digital inclusive finance on agricultural total factor productivity in terms of time and geographical location. Third, the mechanism analysis shows that deepening human capital and regional innovation capacity can effectively drive the growth of agricultural total factor productivity. The research in this paper contributes to a deeper understanding of how agricultural total factor productivity is measured, and the theoretical mechanisms by which digital inclusive finance drives agricultural total factor productivity.