Towards Sustainable Agriculture in China: Assessing the Robust Role of Green Public Investment

Abstract

This paper reviews the long-term impact of public investments on irrigation and agricultural research and development along with other control variables, including physical capital, irrigated area, fertilizer consumption, level of mechanization, and CO2 emissions on China’s agricultural output from 1986 to 2017. This study applied various econometric methods such as the ARDL bound-testing approach and Johansen co-integration procedure to determine the long-term co-integrating connection amid the variables. The empirical outcomes from the ARDL bound-testing method confirm a long-term co-integrating connection among the variables. The long-run results demonstrated that public investment in agricultural research and development and irrigation have a substantial positive effect on agricultural productivity. Furthermore, results revealed that physical capital and fertilizer consumption also have a significant positive effect on agricultural output; however, CO2 emissions have a substantial negative effect on agricultural production. These findings therefore suggest that the policy makers of China should initiate more effective policies to increase irrigation and agricultural research and development investments. Increasing irrigation and agricultural research and development investments will enhance agricultural productivity by ensuring food security in the country.