The Impact of Outsourcing Service Adoption on Pesticide Application Reduction from the Perspective of the Principal–Agent Theory: An Empirical Study from Rural China

Yi Liu, Hanyue Wang, Chongxu Liu, Mengding Li () and Dingde Xu ()
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Yi Liu: College of Management, Sichuan Agricultural University, Chengdu 611130, China
Hanyue Wang: College of Management, Sichuan Agricultural University, Chengdu 611130, China
Chongxu Liu: School of Accounting, Zhongnan University of Economics and Law, Wuhan 430073, China
Mengding Li: School of Economics & Management, Hubei University of Arts and Science, Xiangyang 441053, China
Dingde Xu: College of Management, Sichuan Agricultural University, Chengdu 611130, China

Land, 2024, vol. 13, issue 12, 1-15

Abstract: Pesticide application has significantly aided global agriculture, but the overuse of pesticides also poses a threat to sustainable agriculture development in the future. The application of outsourcing services in the pesticide application process is a good way to promote pesticide reduction, but the actual effect is not satisfactory. The possible reason is ignorance of the regulatory role of supervision and land management scale. Based on the data of 1490 corn growers, this research investigates how outsourcing service application affects pesticide application intensity through the principal–agent theory through the instrumental variable method and examines the moderator effect of supervision and land management scale. The study found that: (1) Farmers who applied outsourcing services during pesticide application process constituted 15% of the farmers in the sample, and the average pesticide cost per 0.000667 km 2 was USD 7.59; (2) The use of outsourcing services in the pesticide application process can lower the pesticide application intensity; (3) The application of outsourcing services in the pesticide application process has received the regulatory role of supervision and land management scale in reducing the intensity of pesticide application. Specifically, supervision can play a positive regulatory role, and land management scale plays a negative regulatory role. The research is helpful to deepen the understanding of the correlation between outsourcing service adoption and pesticide application reduction and provide decision-making reference for the formulation and improvement of pesticide reduction-related policies.

Keywords: principal–agent theory; pesticide application reduction; outsourcing service; supervision; land management scale (search for similar items in EconPapers)
JEL-codes: Q15 Q2 Q24 Q28 Q5 R14 R52 (search for similar items in EconPapers)
Date: 2024
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