External finance and agricultural productivity growth

Khafagy, Amr; Vigani, Mauro

doi:10.1002/agr.21775

Cited by 7 publications

(5 citation statements)

References 75 publications

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“…Further research finds that there is a turning point between county financial marketization and agricultural capital quality. This view has commonality with Khafagy and Vigani (2023) who argue that there is a non-linear relationship between external financing and agricultural productivity. When the level of county financial marketization is low, counties face strong financial exclusion, and agricultural technology research and development and transformation are not supported by financial capital, which hinders the improvement of agricultural capital quality.…”

Section: Resultsmentioning

confidence: 87%

Do county financial marketization reforms promote food total factor productivity growth?: a mechanistic analysis of the factors quality of land, labor, and capital

Liu,

Cui,

Jiang

et al. 2023

Front. Sustain. Food Syst.

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Improving food total factor productivity is a necessary way to break the double constraint of resources and environment, and promote the transformation of the food production system and the realization of the sustainable development goal of zero hunger. Based on the panel data of 729 counties in China from 2010 to 2019, this paper analyzes the effect of county financial marketization reform on food total factor productivity by using a two-way fixed effects model, focusing on the mechanism of the quality of factors such as land, labor and capital. The results show that county financial marketization reform promoted food total factor productivity growth by promoting technical progress, while technical efficiency did not play a significant role. Heterogeneity analysis shows that the effect of county financial marketization reform on grain total factor productivity is not significantly different in eastern and central China. There is a significant difference in the western region, where county financial market reform hindered the growth of grain total factor productivity. In terms of different functional areas of grain production, the facilitating effect is only played in the main grain production area, and the inhibiting effect is played in the main grain marketing area. Mechanistic analysis shows that the county financial marketing reform promoted the growth of food total factor productivity by improving the quality of labor and land, while the quality of agricultural capital has a masking effect. On this basis, it is necessary for the government to implement differentiated financial market-oriented reform strategies, and to guide and encourage county financial institutions to provide financial services to improve the quality of agricultural labor and farmland through tax incentives and loan interest subsidies.

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Section: Resultsmentioning

confidence: 87%

Do county financial marketization reforms promote food total factor productivity growth?: a mechanistic analysis of the factors quality of land, labor, and capital

Liu,

Cui,

Jiang

et al. 2023

Front. Sustain. Food Syst.

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show abstract

“…In fact, Rada and Buccola (2012) argued that agricultural/food productivity benefits from credit expansion, notably in rural areas. Khafagy and Vigani (2023) found a nonlinear relationship between external finance and agricultural productivity. Leverage can also be treated as an indicator of resource mobilization through financing (Beck et al, 2000).…”

Section: Literature Reviewmentioning

confidence: 99%

Food companies' productivity dynamics: Exploring the role of intangible assets

Nakatani

2023

Agribusiness

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Food insecurity has risen amid economic recovery from the COVID‐19 pandemic. Food companies' productivity dynamics can be driven by intangible assets, financing, economies of scale, lifecycle, and technological convergence. We confront this by studying productivity drivers for detailed food manufacturing industries using cross‐country firm‐level panel data. The results show that intangible assets nonlinearly and heterogeneously affect productivity growth, and countries with fewer product market regulations demonstrate higher productivity benefits from asset intangibility. Intangible assets do not play a major role for start‐up companies, while technological convergence drives productivity growth as they learn new technology in the food markets. Regarding the industrial differences, the bakery sector benefits the most from asset intangibility because of its brand images. Financing is particularly important for the meat/fish and dairy sectors, where capital equipment is necessary, and leverage effects are larger for countries with more access to financial institutions. Economies of scale are a vital productivity enhancer in the grain and starch sector for lowering fixed costs. Industrial policies to (i) raise the quality of intangible assets, (ii) promote financial access, and (iii) utilize scale economies are critical for improving the productivity of food manufacturers [EconLit Citations: D24, G32, L66, O34].

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“…Firm characteristics affect the lending relationship between banks and rms (Berger & Udell, 2002; Hsieh, Chen & Lin, 2019), and the impact of nancial development on labor productivity varies across rm characteristics (Khafagy & Vigani, 2023). Discrimination in loan granting exists, with large rms and state-owned enterprises (SOEs) having more access to loans compared to small and private rms (Faccio, 2010).…”

Section: Digital Nance Heterogeneity and Wage Inequalitymentioning

confidence: 99%

The effect of digital finance on wage inequality: Evidence from manufacturing firms in China

Liu,

Chen

2023

Preprint

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Reducing wage gap is crucial to reducing income inequality and promoting economic growth. This study examines the impact of digital finance on wage inequality using national panel data of 273,635 manufacturing firms in China from 2011 to 2015. Findings show that digital finance increases wage inequality, with the highest positive effect observed for the depth of digital finance usage, followed by digital finance coverage, and the lowest effect seen for digitalization in inclusive finance. The robustness and endogeneity tests confirm these findings. Digital finance contributes to wage inequality by alleviating financing constraints. The effect of digital finance on wage inequality varies by firm size, age and ownership. Digital finance has a negative effect on disadvantaged groups in the financial market and exacerbates financial exclusion for small, new, and private firms, leading to wage inequality. Specifically, the positive effect of digital finance on wage inequality is stronger for large firms than for small and medium-sized (SMEs), and old firms than for new firms and foreign firms than for private firms. However, digital finance has no effect on wage inequality in state-owned enterprises (SOEs). This study provides evidence on how optimising digital finance can help narrow income inequality and promote economic growth. JEL classification: D82, O38, J31

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External finance and agricultural productivity growth

Cited by 7 publications

References 75 publications

Do county financial marketization reforms promote food total factor productivity growth?: a mechanistic analysis of the factors quality of land, labor, and capital

Do county financial marketization reforms promote food total factor productivity growth?: a mechanistic analysis of the factors quality of land, labor, and capital

Food companies' productivity dynamics: Exploring the role of intangible assets

The effect of digital finance on wage inequality: Evidence from manufacturing firms in China

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