Economic Impacts of Land Degradation and Climate Change on Agricultural Productivity and Rural Livelihoods in China

This study examines the economic impacts of land degradation and climate change on agricultural productivity and rural livelihoods in China. Climate change is operationalized through a climate stress index that captures temperature anomaly, precipitation instability, water deficit, and drought stress. Using provincial panel data, the analysis combines fixed‐effects estimation, spatial modeling, and resilience‐based moderation to evaluate direct, spillover, and conditional effects. The results show that climate stress is the most immediate and consistent source of economic pressure, with significant negative effects on grain yield, agricultural value added, rural disposable income, and rural consumption expenditure. By contrast, land degradation shows a weaker direct effect in the baseline models, indicating that it operates as a gradual structural pressure on vegetation condition, cropland availability, and land‐use stability. The interaction results are outcome‐specific: the joint LDI–CSI term is not significant for grain yield, while it is positive and significant for agricultural value added, rural income, and rural consumption. This indicates that the combined relationship differs between physical yield and broader rural economic outcomes. The spatial results further indicate that climate‐related pressure is not confined within provincial boundaries, as climate stress generates negative spillover effects across neighboring provinces. In addition, resilience capacity, reflected in irrigation, mechanization, and agricultural support conditions, reduces the severity of these losses. The findings suggest that the economic consequences of land and climate pressures in China are multidimensional, spatially interconnected, and strongly shaped by local adaptive capacity and production‐support systems.