How Capital Endowment and Ecological Cognition Affect Environment-Friendly Technology Adoption: A Case of Apple Farmers of Shandong Province, China

Ever-increasing global environmental issues, land degradation, and groundwater contamination may significantly impact the agricultural sector of any country. The situation worsens while the global agricultural sectors are going through the unsustainable intensification of agricultural production powered by chemical fertilizers and pesticides. This trend leads the sector to exercise environmentally friendly technology (EFT). Capital endowment and ecological cognition may significantly impact fostering farmers’ adoption of environmentally friendly technology. The government also tends to change the existing policies to cope with ever-increasing challenges like pollution control, maintaining ecological balance, and supporting agricultural sectors substantially by employing ecological compensation policy. The study’s main objective is to explore the impacts of farmer’s ecological compensation, capital endowment, and ecological cognition for the adoption of EFT. The empirical setup of the study quantifies with survey data of 471 apple farmers from nine counties of Shandong province. The study used Heckman’s two-stage model to craft the findings. The results showed that 52.02% of fruit farmers adopted two environmentally friendly technologies, and 23.99% of fruit farmers adopted three forms of environmentally friendly technologies. At the same time, we have traced that the capital endowment, planting scale, family income, and technical specialization of fruit farmers significantly impact adopting EFT. The study also revealed that understanding ecological compensation policy has a significant positive effect on adopting environmentally friendly technology. Seemingly, ecological compensation policy has a specific regulatory effect on fruit farmers’ capital endowment and ecological cognition. Therefore, it is necessary to extend the demonstration facilities, training, and frequently arrange awareness-building campaigns regarding rural non-point source pollution hazards and improve the cognition level of farmers. The agriculture extension department should strengthen the agricultural value chain facilities to make farmers fully realize the importance of EFT. Government should promote and extend the supports for availing new and innovative EFT at a reasonable price. Moreover, cooperative, financial, and credit organizations need to lead for the smooth transition of EFT. The agricultural cooperatives and formal risk-taking networks should act responsibly for shaping the behavioral factors of farmers.