The impact of digital agricultural insurance on farmers’ fertilizer reduction technology adoption: evidence from China

Ying Dong, Chenglin Jia and Liufang Su

China Agricultural Economic Review, 2025, vol. 17, issue 2, 379-397

Abstract: Purpose - The purpose of this study is to investigate the impact of digital agricultural insurance on farmers’ fertilizer reduction technology adoption and explain its main mechanisms, as well as to reveal the heterogeneity of the impact with regard to the production scale and crop type. Design/methodology/approach - Using the dataset of CHFS-SCAU2021, this study empirically examines the impact of digital agricultural insurance on farmers’ fertilizer reduction technology adoption by Probit model and employ instrumental variables and treatment effect model to address the potential endogeneity bias. Findings - (1) Digital agricultural insurance can significantly improve farmers’ fertilizer reduction technology adoption and (2) it has a greater promoting effect on the adoption of fertilizer reduction technology compared to traditional agricultural insurance, which still holds after correction of endogeneity bias. (3) Digital agricultural insurance can help promote farmers’ fertilizer reduction technology adoption through decreasing risk aversion, information asymmetry and alleviating financial constraint, while (4) it can only promote the fertilizer reduction technology adoption among large-scale and grain-crop farmers currently. Originality/value - (1) This study is the first to empirically examine the causal impact of digital agricultural insurance on farmers fertilizer reduction technology adoption. (2) This study construct a comprehensive framework to explain the main mechanisms through which digital agricultural insurance influences farmers fertilizer reduction technology adoption both theoretically and empirically. (3) It also compares the disparities between traditional agricultural insurance and digital agricultural insurance in terms of influence on farmers’ fertilizer reduction technology adoption and proposes the relative recommendations on digital agricultural insurance to help improve farmers’ willingness and behavior of fertilizer reduction technology adoption to promote extension efficiency.

Keywords: Mechanisms; Digital agricultural insurance; Fertilizer reduction technology adoption (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eme:caerpp:caer-11-2023-0322

DOI: 10.1108/CAER-11-2023-0322

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