The impact of digital inclusive finance on alternate irrigation technology innovation: From the perspective of the 'catfish effect' in financial markets

Alternating irrigation technology innovation (AITI) is a crucial means of improving agricultural water use efficiency, which is significant for sustainable agricultural development and food security. However, AITI faces severe financing constraints, leading to insufficient funding. Therefore, this study aims to explore how to alleviate the financing constraints on its technological research and development (R&D) and promote innovation in alternating irrigation technology (AIT). From the "catfish effect" perspective in financial markets, this study uses data from 286 prefecture-level cities in China between 2011 and 2022. It applies a two-way fixed effects model and a threshold effect model to empirically test the mechanism of digital inclusive finance (DIF) in promoting AITI. The results show that DIF significantly boosts AITI. Mechanism testing reveals that this effect is driven by the "catfish effect" in financial markets. This effect not only increases the credit availability for innovation entities but also reduces financing costs, thereby fostering technological innovation in alternating irrigation. However, the heterogeneity analysis indicates that this effect varies due to differences in the funding sources for R&D. The impact is more significant for enterprise-type innovators, while it is not significant for individual and research institution innovators. Finally, the threshold model test suggests that the influence of DIF exhibits a marginally increasing nonlinear characteristic.