Assessing the Impact of Digitalization and Technological and Financial Innovation on Grain Production in China

Abstract

Amid global population growth and the pressures of climate change, traditional factors in driving grain production are increasingly inadequate. In this context, this study utilizes panel data from 31 provinces in China (2001–2022) to examine the impact of digitalization (DG), technological innovation (TI), and financial innovation (FI) on grain production (GP). Specifically, the study constructs a comprehensive evaluation framework where DG is measured by mobile communication penetration, TI by agricultural R&D expenditure, and FI by the loan-to-GDP ratio of financial institutions. Employing a fixed effects model, the empirical results demonstrate that DG, TI, and FI yield significant positive returns on GP, with elasticity coefficients of 0.262, 10.675 and 6.589, respectively. Furthermore, synergistic effects are observed, where the interaction between DG and TI (coefficient 0.0402 × 10⁻³) and between DG and FI (coefficient 0.221 × 10⁻²) significantly amplify production capacity. Channel analysis reveals that DG and TI promote GP by fostering agricultural industrial agglomeration, TI and FI by advancing agricultural mechanization, and DG and FI by expanding the agricultural insurance scale. Heterogeneity analysis indicates that these factors significantly boost GP in major grain-producing regions but are insignificant in grain production–marketing balanced regions. In major grain-consuming regions, DG has an adverse effect, TI has no significant impact, and FI has a positive effect. Additionally, in non-humid regions, the positive impacts of DG, TI, and FI on GP are greater.