Transforming ecological dividends into economic benefits through the ecological premium in organic agriculture

Coordinating ecological conservation with farmers’ livelihoods is a central issue in ecological economics. Through the ecological premium mechanism, organic agriculture provides an effective pathway for realizing the value of ecological products and easing the tension between conservation and development. Using 816 household survey observations from Yangxian County, Shaanxi Province, a strongly ecologically constrained area, this study applies an endogenous switching regression (ESR) model to address self-selection bias and empirically examines the average income effect of organic agriculture and its underlying mechanism. A quantile regression (QR) model is further employed to analyze its distributional effects across income groups. The results show that, first, after self-selection bias is controlled for, the ESR estimates indicate that participation in organic agriculture significantly raises farmers’ agricultural income once self-selection is controlled for. Second, the ecological premium generated by regional public branding, represented by the Crested Ibis brand, and organic certification is an important mechanism for income growth and effectively compensates for yield losses caused by strict ecological regulation. Third, the income effect of organic agriculture displays clear distributional heterogeneity: the effect is stronger for low-income households that depend more heavily on natural resources and have weaker initial endowments, indicating a pronounced pro-poor characteristic. These findings suggest that developing organic agriculture in ecologically sensitive areas can transform ecological advantages into economic benefits while narrowing income disparities among farmers. Organic agriculture is therefore a useful policy instrument for achieving both ecological conservation and sustainable rural revitalization.