Summary:
The emergence of new agricultural operators in China includes agricultural business entities with relatively large operating scales and good management capabilities and material equipment conditions. In addition, they have relatively high labor productivity and land output and resource use rates, with commercialized production as their primary goal. These business entities include family farms, farmers' cooperatives, and agricultural enterprises, which not only promote agricultural modernization and increase the added value and supply of agricultural products, but also improve farmers' income and living standards. In recent years, the Chinese government has attached great importance to the development of new agricultural operators and has introduced a series of supporting policies and measures. However, the development of new agricultural operators also relies heavily on financial support. In reality, due to limited personal wealth, lack of collateral, and insufficient credit records, financial institutions, especially commercial banks, do not favor the creators of these entities, who are mainly farmers. These farmers find it difficult to raise sufficient funds; therefore, they cannot operate their projects normally. Fortunately, digital inclusive finance in China has developed rapidly in the past decade. According to the World Bank's 2021 Global Findex Database, China has become an important leader in the development of digital finance worldwide. Digital inclusive finance has not only overcome the pain points of traditional rural finance, such as information asymmetry and high transaction costs, but has also greatly improved the accessibility, convenience, and effectiveness of financial services for the agricultural sector. This paper explores whether the development of digital inclusive finance can alleviate farmers' financial constraints and promote the establishment of new agricultural operators？ Studying this issue not only expands the literature on digital inclusive finance services for the real economy, but also provides references and insights for the development of digital inclusive finance and the modernization of agriculture in other developing countries. This paper uses panel data from 1,845 counties in 27 Chinese provinces between 2014 and 2020 in an instrumental variable approach to empirically examine the impact of the development of digital inclusive finance on the creation of new agricultural operators, in addition to its underlying mechanisms. We report three main findings. First, the development of digital inclusive finance has a significant positive effect on the creation of family farms, farmers' specialized cooperatives, and agricultural enterprises. This conclusion is robust under various sensitivity tests, including controlling for region-time fixed effects and constructing a difference-in-differences model using the “FIGI China Project” pilot. Second, the mechanism analysis shows that digital inclusive finance not only directly promotes the creation of new agricultural operators by improving farmers' access to formal credit, but also indirectly promotes new agricultural operators by increasing farmers' income and agricultural mechanization levels. Third, a heterogeneity analysis indicates that the breadth, depth, and digitization of digital finance all have a positive impact on the creation of new agricultural operators. Digital inclusive finance has a stronger effect on the creation of small and micro agricultural operators, compared with medium and large new agricultural operators, which highlights the inclusiveness of China's digital inclusive finance development. Furthermore, the impact of digital inclusive finance on the creation of new agricultural operators varies across counties, with a stronger effect in areas with less topographical variation. This paper makes three main contributions to the literature. It is the first empirical study to examine the impact of digital inclusive finance on the creation of new agricultural operators, which enriches the literature on the role of digital inclusive finance in promoting rural revitalization. Earlier digital inclusive finance studies have mainly focused on its impact on farmers' entrepreneurship, agricultural production, and rural poverty, while its effect on the creation of new agricultural operators has not been explored fully. Second, this paper elucidates the mechanisms through which the development of digital inclusive finance affects the creation of new agricultural operators, including both direct and indirect effects. The findings reveal the deeper reasons for the promotion of the creation of new agricultural operators using digital inclusive finance. Third, we examine the heterogeneity of the impact of digital inclusive finance on the creation of new agricultural operators from three perspectives, namely digital finance heterogeneity, the scale of new agricultural operators, and the topographical variation across counties. These results provide new insights into how digital inclusive finance promotes the creation of new agricultural operators.
黄祖辉, 宋文豪, 叶春辉. 数字普惠金融对新型农业经营主体创立的影响与机理——来自中国1845个县域的经验证据[J]. 金融研究, 2023, 514(4): 92-110.
HUANG Zuhui, SONG Wenhao, YE Chunhui. The Impact and Mechanism of Digital Inclusive Finance During the Establishment of New Agricultural Operators: Evidence from 1,845 Chinese Counties. Journal of Financial Research, 2023, 514(4): 92-110.
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