Farmland’s Comprehensive Improvement and Agricultural Total Factor Productivity Increase: Empirical Evidence from China’s National Construction of High-Standard Farmland

Farmland improvement has become an overwhelmingly favorable policy in developing countries, being expected to leverage a sustainable agricultural total factor productivity (ATFP) to increase their agricultural competitiveness. Worldwide farmland improvement projects are experiencing an evolution from single goals to comprehensive goals (e.g., comprehensively improve the farmland quality by decreasing farmland abandonment and fragmentation and meanwhile improving soil–water conditions and machinery affordability). However, performances of comprehensive farmland improvement projects have been questioned, especially considering its implementary complexity and regional heterogeneity. This study applies a continuous difference-in-difference (DID) method to China’s provincial panel data (2005–2020) to analyze the impact of the high-standard farmland construction policy (which started China’s national project on comprehensive farmland improvement) on ATFP. Results show the policy significantly increases ATFP by 0.101 units. Moreover, parallel trend and robustness test results indicate the policy effect has stability and continuity. Heterogeneity analysis results show the policy effect is greater in major grain-producing regions than non-major grain-producing regions, the central regions than western or eastern regions, and regions with high disease—pest control and soil—water conservation levels than areas with low levels. Mechanism analysis results show the policy effect is achieved through three paths—operation scale increase (mediating effect size is 16.13%), planting structure adjustment (mediating effect size 12.80%), and agricultural disaster reduction (mediating effect size 13.74%). Thus, this study advocates sustainable and specialized high-standard farmland construction: it suggests post-construction policies maintaining high-standard farmland quality and detailed policies considering different regions’ heterogeneity.