Effects of farmers’ Adoption of Green Production Technologies on Income Growth and Distribution: Evidence From China

ABSTRACT Agricultural green production technologies (GPTs) are critical for mitigating the negative environmental impacts of farming activities. However, farmers' willingness to adopt GPTs heavily depends on their impact on farmers' earnings, which can considerably vary. Empirical evidence so far has been inconclusive or contradictory regarding the impact of GPTs adoption on income distribution. This study uses survey data from 2034 farming households across 14 provinces in China to empirically investigate how GPTs adoption influences farmers' income and income distribution. We found a significant increase in the agricultural and total household income of farmers who adopted GPTs compared to those who did not. GPTs contribute to farmer's income growth through three main channels: reducing pesticide inputs increasing sales revenue from agricultural products and boosting agricultural output. Moreover, GPTs adoption has heterogenous effects on farmers' incomes. Farmers who are highly educated, relatively richer and operated larger farms tended to benefit more from adopting GPTs. Consequently, GPTs adoption exacerbates income inequality in rural society. Overall, this study highlights the potential side effects of promoting GPTs and calls for actions to address the distributional impacts of these environmental initiatives.