Does agricultural factor misallocation hinder agricultural green production efficiency? Evidence from China

Abstract

The sustainable development of agriculture is challenged by two major issues: increasing resource constraints and environmental pollution. Sustainable agricultural development is achievable by improving green total factor productivity from the perspective of resource allocation. To promote the green development of agriculture, this paper utilizes the SBM super-efficiency mode and thus calculates the agricultural resource misallocation index and agricultural green production efficiency index in China between 2001 and 2019. Furthermore, this paper discusses the temporal and spatial evolution characteristics of agricultural green production efficiency, using a fixed model and spatial econometric models to estimate the influence effect of agricultural resource misallocation on green production efficiency. Below are the results. First, China's agricultural green total factor productivity is growing at an impressive rate, with high efficiency in the northeast, northwest, and southeast coastal areas and low efficiency in the central and inland areas. Second, agricultural capital misallocation, labor misallocation, and land misallocation all negatively impact agricultural green production efficiency. Accordingly, the misallocation of agricultural factors will hamper the growth of agricultural green production efficiency in this region and also in the surrounding areas. Third, the indirect impact on the own agricultural green production efficiency exceeds its direct impact on neighboring regions' efficiency. Fourth, the mechanisms are the upgrading of agricultural industry structure and green technology innovation. According to the findings, reducing resource misallocation can substantially enhance agricultural green productivity, which is an imperative step in addressing agricultural green production. Hence, policies should be formulated that highlight the regional allocation of agricultural production factors and green production-oriented concept of agricultural production. Also, the government should promote the transformation and upgrading of the agricultural industrial structure, as well as the application of green agricultural technologies.