The Impact of Agricultural Fiscal Expenditure on Water Pressure in Grain Production: Provincial-Level Analysis in China

Ziqiang Li, Weijiao Ye () and Ciwen Zheng
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Ziqiang Li: School of Management, Putian University, Putian 351131, China
Weijiao Ye: College of Business Administration, Fujian Business University, Fuzhou 350012, China
Ciwen Zheng: College of Economics and Management, Huazhong Agricultural University, Wuhan 430070, China

Sustainability, 2025, vol. 17, issue 12, 1-27

Abstract: Financial support for agriculture has mainly focused on grain production, while insufficient efforts have been made to ensure water security, potentially intensifying water pressure in grain production (WPGP). This study applies the entropy weight Technique for Order Preference by Similarity to an Ideal Solution (TOPSIS) method to measure WPGP from the perspective of sustainable agricultural water use, investigating the impact of agricultural fiscal expenditure on WPGP. Our findings reveal several key points. First, there is a clear linkage between the spatial and temporal patterns of fiscal support and WPGP. Projections indicate that water pressure for grain production in China will continue to rise from 2019 to 2030, with the fastest increases in the Northeast and Huang-Huai-Hai regions, at 20.53% and 13.39%, respectively. Second, agricultural fiscal expenditure distorts the allocation of grain production factors, causing cultivation areas to expand beyond local water resource capacity and, thus, exacerbating WPGP. This effect exhibits a time lag due to the gradual nature of factor allocation. Further analysis shows that in non-major grain-producing regions, lower production efficiency and higher opportunity costs of factor use weaken the impact of fiscal expenditure on WPGP compared to major grain-producing regions. Third, in regions with advanced technical conditions for grain production, the negative impact of agricultural fiscal expenditure on WPGP is mitigated by higher irrigation technology levels, improved water allocation efficiency, and lower water demand per unit of grain. Fourth, the public good characteristics of water resources and water conservancy facilities—namely, strong externalities and non-exclusivity—along with the agronomic demonstration effect, lead to a spatial spillover effect of agricultural fiscal expenditure on WPGP.

Keywords: agricultural fiscal expenditure; water pressure in grain production; grain production technology; crop sown area; spatial spillover effect (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
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