Does contract farming promote farmers’ organic agriculture adoption?Counterfactual analysis based on survey data of western Hunan farmers

Contract farming is an innovative method for developing organic agriculture in China. Clarifying whether contract farming promotes farmers’ adoption of organic agriculture can provide a decision-making basis for promoting organic agriculture in China. This study applied the propensity score matching method to construct a counterfactual analysis framework to test the treatment effects and heterogeneity of contract farming on farmers’ organic agriculture adoption based on farm-level survey data of 450 farmers from Baojing, Lanshan, Guzhang, Yongshun and Huayuan counties of Hunan Province. Our empirical results showed that contract farming plays a significant role in promoting farmers’ adoption of organic agriculture. The average treatment effect estimated based on five score matching methods showed that compared with farmers who did not participate in contract farming, the average treatment effect of farmers who participated in contract agriculture was 0.45−0.54. Moreover, for farmers from national organic product demonstration areas, with low awareness of organic agriculture, risk-averse farmers, and small-scale and part-time farmers, the average treatment effect of contract farming on organic agriculture adoption was more notable. Therefore, the government should encourage farmers to participate in contract farming. Furthermore, considering the heterogeneity of the treatment effect of contract farming on farmers’ adoption of organic agriculture, the government should develop contract farming modes that are suitable for farmers with different endowment constraints, risk attitudes, and organic agriculture cognition, and strengthen the establishment of national organic product certification demonstration.