The impact of digital investment on AGVC resilience-with a discussion on the moderating role of domestic market size

Purpose The purpose of this paper is to examine the impact of digital investment on Agricultural Global Value Chain (AGVC) resilience and investigate whether this effect varies with domestic market size. Design/methodology/approach Using country-industry-year fixed effects with nine-year panel data from the University of International Business and Economics Global Value Chain Database and Organisation for Economic Co-operation and Development Inter-Country Input-Output Tables, this study investigates the relationship between digital investment and AGVC resilience, analyzing heterogeneity by digital investment type, processing segment, and digital investment source. A triple interaction term-combining domestic market size, digital investment, and value chain downstreamness-is introduced to capture the interdependence of these determinants. Findings This study finds that digital investment strengthens AGVC resilience through improved institutional environments and optimized resource allocation, with labor substitution serving as a key mechanism-particularly in high-income economies. Market scale amplifies this via reverse-pull and agglomeration effects. Gains are strongest in deep-processing sectors and domestic-digital-driven chains but absent in primary processing. Foreign digital reliance offers no benefit and may weaken resilience. The positive interaction between digital input and domestic market size is significant under lenient international regulations or high institutional quality, but insignificant under strict regulations or low institutional quality. Originality/value This study addresses the critical yet often overlooked topic of AGVC resilience-a key pillar of contemporary food security. It examines how digital investment strengthens AGVC resilience, offering new insights into the stabilizing role of technology adoption amid rising global disruptions. The research further highlights how domestic market scale critically amplifies the effects of digital investment.