The impact of agricultural OFDI network status on home countries' food security

Abstract

Using agricultural outward foreign direct investment (OFDI) data for 85 countries from 2007 to 2022 in the Financial Times FDI Markets database, this study employs social network analysis to construct a global agricultural OFDI network. Based on an analysis of global agricultural OFDI network characteristics, this study empirically examines the impact of OFDI network status on home countries' food security. The results reveal that the contemporary global agricultural OFDI network is dominated by developed countries, but is gradually moving toward a multicenter trend. A home country's rising position in the agricultural OFDI network will significantly promote food security. Heterogeneity analysis reveals that intermediary centrality and network connection strength have significantly positive impact on home countries' food security. The stronger the “transit” ability of a country in the agricultural OFDI network, the deeper the investment intensity in other countries, the more conducive to the food security of the home country. The impact of a country's position in the agricultural OFDI network on food security is also heterogeneous among countries with different income levels and coastline lengths. The results of the mechanism test demonstrate that the promotional status of a country's agricultural OFDI network position can positively affect food security by encouraging agricultural finance development and independent agricultural research and development. Based on this, the study suggests that China should further encourage agricultural enterprises to “go global,” build a strategic agricultural OFDI network system, enhance its position in the global agricultural OFDI network, strengthen the collaboration of network nodes, and improve policies such as financial support and innovation support to ensure the country's food security.