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

Vollständiger Abstract

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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.