Little Brands, Big Profits? Effect of Agricultural Geographical Indicators on County-Level Economic Development in China

Abstract

AGIs (agricultural geographical indicators) are effective quality signals that can improve market welfare, but few studies have investigated the impact of AGIs on economic development. To fill this gap, this paper explores the impact of AGIs on per capita GDP and its mechanisms, according to country-level data in China from 2000 to 2018. For every additional AGI in the country, GDP per capita increased by 0.2–0.4%. Our conclusion remained reliable after various robustness tests. These effects were more salient in western areas, the main grain-producing areas, and settled areas. AGIs related to aquatic environments, animal husbandry, and planting products promoted economic development most significantly. For these effects, encouraging an increase in agricultural value (improving the quantity and quality of products) and promoting the agglomeration of populations, capital, and enterprises in the agricultural sector were the main mechanisms.