Analysis of Resource Misallocation and Total Factor Productivity Losses in Green Agriculture: A Case Study of the North China Region

Linfang Chen, Huanyu Sun, Shenghui Zhou, Shixing Jiao, Xiao Zhao and Jianmei Cheng ()
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Linfang Chen: School of Environmental Studies, China University of Geosciences, Wuhan 430078, China
Huanyu Sun: Yangzhuang Senior High School, Zhumadian 463900, China
Shenghui Zhou: The College of Geography and Environmental Science, Henan University, Kaifeng 475000, China
Shixing Jiao: School of Resources & Environment and Tourism, Anyang Normal University, Anyang 455002, China
Xiao Zhao: The College of Geography and Environmental Science, Henan University, Kaifeng 475000, China
Jianmei Cheng: School of Environmental Studies, China University of Geosciences, Wuhan 430078, China

Sustainability, 2024, vol. 17, issue 1, 1-25

Abstract: The inefficient allocation of resources in agricultural production not only affects the quality of agricultural development and the efficiency of resource utilization but also represents a pivotal issue that constrains the sustainable progress of agriculture. Considering the urgent societal need for the optimization and advancement of industries, investigating the issue of resource misallocation within agricultural production and its specific losses on AGTFP is profoundly important in advancing the pursuit of high-quality and sustainable agricultural development. This study employs the Cobb–Douglas function and the theory of price distortion to establish a model for quantifying losses in Agricultural Green Total Factor Productivity (AGTFP). Drawing on provincial panel data from North China spanning the years 2006 to 2022, we analyze the characteristics of resource allocation and the corresponding losses in AGTFP. The findings suggest that AGTFP in North China has been gradually rising, accompanied by notable regional disparities in both the level of AGTFP and its growth rate. Nevertheless, due to the varying effects of distorted agricultural input factors, there exists different resource misallocation across North China. Despite some improvement in resource misallocation, this improvement has not been significant. Consequently, there is a loss of AGTFP in the North China region. If resource misallocation is effectively addressed, AGTFP losses could be reduced by at least 29%. It is anticipated that over the course of the next decade, AGTFP will rise and resource misallocation and AGTFP losses will diminish slightly, and it is crucial to step up efforts to enhance resource allocation. By ensuring adequate agricultural funding, enhancing agricultural efficiency, and optimizing energy inputs, it is possible to mitigate resource misallocation, thereby effectively diminishing AGTFP losses and fostering the sustainable advancement of agriculture.

Keywords: resource misallocation; agricultural green total factor productivity (AGTFP); price distortion theory; North China (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2024
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