Analysis of the Spatial Effect of Capital Misallocation on Agricultural Output—Taking the Main Grain Producing Areas in Northeast China as an Example

Abstract

Increasing agricultural output by reducing capital misallocation is a capital-saving strategy, as it does not require the usage of additional inputs. Based on the panel data of 36 prefecture-level cities in northeast China from 2011 to 2020, this paper uses the spatial Durbin model to test the impact of capital mismatch on agricultural output and its mechanisms. We found that capital misallocation is prevalent in prefecture-level cities, showing a spatial distribution characteristic of “north-south confrontation and central collapse”, with a significant spatial spillover effect. A one-unit increase in capital misallocation leads to a 16.00% decrease in local agricultural output and a 1.80% decrease in adjacent areas. However, with the optimization and upgrading of the agricultural industry and agricultural technology progress, the inhibitory effect of capital misallocation on the growth of agricultural output is constantly weakening. The above conclusion still holds after a series of robustness tests. The conclusion of this paper provides policy inspiration for promoting the rational allocation of factors between cities and regions, coordinating regional coordinated development, and then promoting the sustainable growth of agricultural output.

Spatial Spillover Effect and Nonlinear Relationship between Factor Misallocation and High-Quality Agricultural Economy: Evidence from 154 Cities in Major Grain-Producing Areas of China

“…This is consistent with the previous study of the impact of factor misallocation on agricultural development. For example, based on the data of prefecture-level cities in the major grain-producing areas of northeast China, Qin (2022) [55] found that with the optimization and upgrading of the agricultural industry and the continuous improvement of the level of agricultural science and technology, the negative impact of capital misallocation on agricultural output is continuously weakened [55]. Based on the panel data at the provincial level in China, Lei et al (2023) found that the impact of capital misallocation and labor misallocation on China's agricultural green total factor productivity has a spatial effect [56].…”

A study on the impact of rural finance on high-quality agricultural development in China—a test based on intermediation, threshold and spillover effects

“…In particular, with the introduction of China's new development concept, more scholars tend to construct and measure the indicators of China's HQAD in five dimensions: innovation, coordination, green, openness, and sharing (Liu T. et al, 2020;Li and Xu, 2020). In terms of influencing factors, endogenous drivers include industrial structure adjustment (Wu et al, 2020), factor allocation optimization (Jin et al, 2018), and effective utilization of agricultural subsidies (Zhang et al, 2020); Exogenous drivers include foreign direct investment (Wang et al, 2019), new urbanization development (Liu J. et al, 2020), government policies (Qin et al, 2022a), and digitization of agriculture (Tang and Chen, 2022).…”

High-Quality Development of Chinese Agriculture under Factor Misallocation

“…Previous studies have proved that optimizing factor allocation is the prerequisite for promoting high-quality agricultural development [ 15 ]. However, production factors cannot flow freely and be allocated effectively in accordance with market rules, because regional market segmentation and factor market-oriented reform lag behind [ 16 ], leading to the factor mismatch problem in China’s agriculture for a long time [ 17 , 18 ].…”