How does farmer differentiation effect agricultural water use efficiency? Evidence from China

Farmer differentiation is a prevalent phenomenon in developing countries, such as China, which is expected to have a profound effect on rural collective actions, especially in the realm of agricultural irrigation. Despite this, few studies have been conducted to investigate the impact of farmer differentiation on agricultural water utilization. This research utilizes China's provincial panel data to construct indicators of farmer differentiation and agricultural water use efficiency through the entropy method and super-efficient DEA, and investigate how farmer differentiation affects agricultural water use efficiency. Our findings reveal a significant negative effect of farmer differentiation on overall agricultural water use efficiency. Mechanism analysis indicates that inadequate facility management has a negative mediating effect between farmer differentiation and agricultural water use efficiency, while large-scale grain crop production has a positive mediating effect. Additionally, the investment in small farmland water conservancy and central investment have a positive moderating effect. Notably, when the proportion of investment in maintenance of farmland water conservancy exceeds a certain threshold, the negative impact of farmer differentiation on agricultural water use efficiency can be eliminated. This study provides targeted recommendations on how to improve agricultural water use efficiency in the current situation of farmer differentiation. • Farm differentiation (FD) negatively affects agricultural water use efficiency (WE). • Facility management and scale of grain crop planting have opposite mediating effects. • Investment in farmland water conservancy construction has a moderating effect. • Impact of FD on WE will disappear when maintenance investment exceeds threshold value.