Land market distortion and agricultural green total factor productivity: provincial-level evidence from China

Abstract

Based on provincial-level agricultural input and output data in China from 2000 to 2019, this study estimates the Luenberger-Hicks-Moorsteen index using the nonparametric method of the directional distance function to obtain agricultural green total factor productivity (AGTFP). The results show that AGTFP in China has increased significantly over the past 20 years, with significant differences between provinces and among the eastern, central, and western regions. Land market distortion has had a significant negative impact on AGTFP. The results suggest that the government needs to promote the market-oriented reform of land factors, solve the price distortion caused by land finance, promote the intensification and modernization of agricultural management, and realize the potential of green agricultural production.

Keywords:

• Green total factor productivity
• land market distortion
• agriculture
• Luenberger-Hicks-Moorsteen indicator
• China

JEL CODES:

• A10
• D20
• Q24

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1 Dipanjan Roy Chaudhury. 2020. ‘With rising population and declining arable land, China may be staring at a major food crisis', The Economic Times. <https://economictimes.indiatimes.com/news/international/world-news/with-rising-population-and-declining-arable-land-china-may-be-staring-at-a-major-food-crisis/articleshow/77942570.cms?from=mdr>