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

Abstract

Promoting the high-quality development of agriculture is an inevitable requirement toward realizing the transformation from a large agricultural country to a powerful one, and optimizing factor allocation is a prerequisite. In this paper, we use spatial econometric models to analyze the impact of factor misallocation on the high-quality development of the agricultural economy based on panel data from 154 prefecture-level cities in major grain-producing regions from 2004 to 2020. We found that factor misallocation was relatively low at the prefecture level, with an average annual decrease of 0.82 percent, compared to an average annual increase of 1.29 percent for the high-quality development of the agricultural economy. Factor misallocation inhibited improvements in high-quality agricultural economic development in adjacent cities. This conclusion remained stable after a series of tests, and the inhibitory effect exhibited significant spatiotemporal heterogeneity due to differences in geographical location, developmental level, and factor allocation methods. At the same time, a mechanism test demonstrated a continuous weakening of the inhibitory effect, accompanied by the optimization and upgrading of the agricultural industry, as well as an improvement in agricultural scientific and technological progress. In addition, nonlinear tests demonstrated that the impact of factor misallocation on the high-quality development of the agricultural economy exhibits significant nonlinear features as agricultural science and technology advances.

Do Factor Misallocations Affect Food Security? Evidence from China

“…The trickle-down and diffusion effects resulting from the comprehensive adoption of agricultural information technology facilitate the effective integration of cross-regional capital, labor, technology, and other factors [52,53], thus enhancing food security levels. The successful local implementation of advanced agricultural information technology facilitates its dissemination to surrounding areas through technology transfer and diffusion [54]. This process contributes to enhancing agricultural production efficiency.…”

“…The theoretical analysis indicates a spatial spillover effect of factor misallocations on food security. Referring to Chen et al ( 2023) [54], this paper employs the Moran index I to analyze the spatial correlation.…”

“…Therefore, this paper refers to Chen et al ( 2023) [54] and Zhao (2022) [79], dividing the samples according to the grain functional zones and Hu line, and the results are shown in Table 7. The misallocation of capital, labor, and land has a significantly negative impact on food security in major producing areas, consistent with the previous regression results.…”