The Role of Rural Infrastructure in Reducing Production Costs and Promoting Resource-Conserving Agriculture

Qinghua Wu, Xiaoliang Guan, Jun Zhang and Yang Xu
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Qinghua Wu: School of Economics and Management, Wuhan University, Wuhan 430070, China
Xiaoliang Guan: College of Economics & Management, Huazhong Agricultural University, Wuhan 430070, China
Jun Zhang: School of Business Administration, Hubei University of Economics, Wuhan 430205, China
Yang Xu: School of Economics and Management, Hubei University of Science and Technology, Xianning 437100, China

IJERPH, 2019, vol. 16, issue 18, 1-13

Abstract: The development of rural infrastructure plays an essential role in improving rural livelihoods and enhancing sustainable and environmentally friendly agricultural production. However, little is known about whether rural infrastructure enables the promotion of resource-conserving agriculture and reduces production costs. Understanding the relationship between rural infrastructure and production costs can provide significant information for policy-makers in their efforts to promote resource-saving agriculture that is beneficial to environmental performance. This study contributes to the literature by analyzing the heterogeneous effects of irrigation infrastructure and standard and substandard roads on agricultural production costs, using an unconditional quantile regression model and provincial data from China for the period 1995–2017. The empirical results show that the effects of rural infrastructure on production costs are mixed. In particular, irrigation infrastructure affects production costs positively in the lower quantiles, but it negatively affects production costs in the higher quantiles. In the higher 80th and 90th quantiles, standard and substandard roads affect production costs both negatively and significantly. Our findings suggest that improving rural infrastructure enables the promotion of resource-conserving agriculture and enhances environmental performance, especially for those paying high production costs.

Keywords: infrastructure; resource-conserving agriculture; production costs; unconditional quantile regression (search for similar items in EconPapers)
JEL-codes: I I1 I3 Q Q5 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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