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Business & Economics

IMPACT OF FINANCIAL SUBSIDIES ON ECOLOGICAL AGRICULTURE BENEFITS: EVIDENCE FROM CHINA⁹
Yingyuan Liu, Yudong Zhou, Haifeng Zhao, Soro Sonfoungowari Mathieu

ABSTRACT. Under the dual constraints of resources and the environment, numerous countries present inclusive financial subsidy policies. The mechanism between financial subsidies and ecological agriculture benefits must be explored further to achieve high-quality agricultural development. To scientifically evaluate the ecological agriculture benefits and reveal the impact of financial subsidies on the different dimensions of ecological agriculture benefits and their regional heterogeneity, a comprehensive evaluation system for ecological agriculture benefits was constructed in this study using panel data of China's agriculture from 2010 to 2018. Moreover, the differential GMM (Generalized Method of Moments) model was used for empirical testing. Results show that ecological agriculture benefit fluctuations increase and economic and ecological benefits grow rapidly. Furthermore, financial subsidies have a significant positive correlation with ecological agriculture benefits, but differences are observed in their impact on the different dimensions of ecological agricultural benefits, specifically, financial subsidies have a significant promotion effect on the economic and social benefits of ecological agriculture but a significant inhibition effect on ecological benefits. From a regional point of view, the impact of financial subsidies on ecological agriculture efficiency exhibits obvious regional heterogeneity, and the impact on the Central and Western regions in China is significantly higher than that on the Eastern and Northeast regions. The conclusions have theoretical and practical reference value for enriching differentiated financial subsidy policies, improving the implementation efficiency of regional financial subsidies, and promoting the sustainable development of ecological agriculture. Under the background of the coordination and unification of agricultural production and ecological environment, the steady growth of agricultural economy should be promoted to realize the sustainable development of agriculture.

KEYWORDS:  financial subsidies, benefit of ecological agriculture, economic performance, social results, ecological benefit.

JEL classification:  Q57, Q18, F41, F43, R58.

⁹Acknowledgment:  This study was supported by the Humanity and Social Science Foundation of the Ministry of Education of China (No19YJA790061).