Relational Patient Capital and Agricultural Technological Innovation: Evidence from Chinese Agricultural Technology Enterprises

Agricultural technological innovation is essential for sustainable agricultural modernization and rural development. However, agricultural technology enterprises often face persistent financing constraints because research and development (R&D) activities involve long investment cycles, high uncertainty, and delayed returns. Using a firm-level panel dataset of Chinese agricultural technology enterprises, this paper examines the effect of relational patient capital (RPC) on agricultural technological innovation by employing a two-way fixed-effects model. The results show that RPC significantly promotes agricultural innovation output. Mechanism analysis indicates that RPC enhances innovation through two channels. First, it facilitates firms’ digital transformation, thereby reducing R&D uncertainty and organizational costs. Second, it alleviates financing constraints by stabilizing cash flows to support R&D investment. The results remain robust after clustering standard errors, excluding the years affected by the COVID-19 pandemic, and employing lagged specifications. Heterogeneity analyses further reveal that the positive effect is more pronounced among small-scale enterprises and firms located in central and eastern China, where financing frictions and resource constraints are relatively more severe. By linking RPC to firm-level agricultural innovation, this study extends the literature on agricultural finance and innovation financing, highlighting the role of long-term, relationship-based capital in addressing market failures in agricultural R&D. The findings suggest that rural financial policies should encourage stable, long-term investment, strengthen financing support for small agricultural technology enterprises, and integrate patient capital with digital transformation initiatives to promote sustainable agricultural and rural development.