Market access, agricultural product prices, and smallholder farm income in China

This paper examines the causal effects of digital market access on agricultural product prices and smallholder farm income in China, using a balanced county panel. We construct a Digital Market Access Index (DMAI) through principal component analysis of multiple dimensions: e-commerce adoption, mobile payment penetration, price information access, and rural logistics services. County and year fixed effects, instrumental variable estimation, and Hansen panel threshold regression identify large, nonlinear, and causally robust effects of DMAI on farm gate prices, price transmission efficiency, marketing margins, and farm income. An improvement in DMAI raises log farm gate prices and log per-capita farm income while compressing wholesale-to-retail marketing margins. Threshold analysis identifies significant transition points that partition counties into early-adoption, expansion, and maturity regimes, with increasing marginal effects across regimes. Bootstrap mediation decomposes the total price effect into price information capacity, supply chain reduction, bargaining power, and logistics efficiency channels, which jointly account for most of the total effect. Moderation analysis reveals complementarities with road infrastructure, farmer education, and cooperative membership. Spatial Durbin models document significant cross-county price spillovers. Results are robust across multiple alternative specifications.