Agricultural insurance shows spatially heterogeneous effects on nitrogen surplus and its induced water shortage in China

Nitrogen surplus (NS) serves as a crucial indicator reflecting both agricultural nitrogen (N) management performance and N pollution control. While agricultural insurance (AI) is recognized as a key financial tool for fostering agricultural activities, its effects on NS remain unquantified due to the absence of a framework linking financial, agricultural, and environmental systems. Utilizing the data from 333 cities from 2006 to 2020, we construct an integrated N balance model to calculate the NS levels across the cities and find that approximately 45%, 82%, and 85% of cities experienced a significant decrease in NS in the west, central, and east regions, respectively. We further demonstrate the significance and robustness of the spatially heterogeneous AI effects on NS, with AI being associated with a moderate increase in NS in the west (0.0452 ± 0.0236), but decreases in the central (−0.0311 ± 0.0307) and east (−0.0654 ± 0.0355) regions, indicating distinct regional responses to AI adoption. Particularly, a diminishing adverse AI effect in the West is determined but projected to eventually reverse from an NS rise to a reduction after 2020. Moreover, the AI investment contributed to a total of 1282 kt NS decline in China in 2020 and the resulting decrease in NS-induced water shortage in the central and east (yet an increase in the west). However, it has merely slight effects on lowering the NS-induced water shortage risk in most of the cities. This drives us to promote past AI programs to further address the water shortage risks induced by NS.