How is agricultural water efficiency affected by the digital economy? Insights from China

Abstract

Abstract With the continued advancement of digital technology, the digital economy will gradually become the primary economic form in the future, having a profound impact on a variety of industries, including agriculture. Agriculture is a major source of global water use, and efficient water use in agriculture is critical to coping with water scarcity and ensuring food security. This study used publicly available data from 30 Chinese provinces from 2006 to 2017 to estimate the relationship between the digital economy and agricultural water use efficiency using the systematic generalized method of moments technique. According to the findings, a 1% increase in the digital economy indicator is associated with a 0.053% increase in agricultural water use efficiency. In addition, the digital economy improves agricultural water usage efficiency through three mediating channels: structural effect, scale effect, and spillover effect. For the digital economy and agricultural water use efficiency to develop in tandem, the Chinese government should strive to strengthen the development of the digital economy and work on the intermediate channels demonstrated in this study.