Promoting the organic integration of smallholders and modern agriculture is crucial to motivating the modernization of agriculture with Chinese characteristics. Studies have shown the strategic importance of developing multiple forms of agricultural socialized services. How to further promote the compelling connection between smallholders and agricultural socialized services and reduce the transaction costs of their integration into modern agriculture is a practical problem that must be solved for the modernization of agriculture under the background of “big country, small farmers”. Recently, the rapid development of Internet information communication technology (ICT) has significantly and profoundly impacted agricultural and rural development. However, there is a lack of research from logical mechanisms to empirical tests on whether ICT can effectively promote the integration of smallholders into modern agricultural development. In particular, the integration of smallholders at the micro level has not been studied in depth.

Based on the bounded rationality hypothesis and information asymmetry theory, this article elaborates on the mechanism of ICT promoting smallholders' integration into modern agriculture. Furthermore, this article empirically tests how the Internet use promoted smallholders' integration into modern agriculture based on the China Labor Dynamics Survey (CLDS) microdata in 2018. The empirical results show that: First, the internet use has a significant positive effect on promoting the smallholders' mechanization of production, the enlargement of farmland scale, and the investment in agricultural production. And the research hypotheses are all tested. Second, this article performs robustness tests by replacing the core explanatory variables and regression model and endogeneity tests with the Eprobit model. The results all indicate the robustness of the benchmark model results. Third, heterogeneity analysis shows that the effect of digital empowerment is more significant in large-scale smallholders, middle-aged and elderly smallholders, and smallholders in central and northeast China.

Compared with previous literature, this article makes two extensions: First, based on the bounded rationality hypothesis and information asymmetry theory, this article elaborates on the theoretical logic and internal mechanism of ICT enabling smallholders to integrate into agricultural modernization against the background of market failure caused by information asymmetry in the agricultural socialized service market. It expands the previous literature on how to promote the integration of smallholders into modern agriculture from a new perspective of digital empowerment. Secondly, different from existing empirical studies on the development of the digital economy and modern agriculture at the macro level, this article uses the data of micro smallholders in China for the empirical test. Based on clarifying the causal relationship between the Internet use and the integration of smallholders into modern agriculture, this article explores the complementary relationship between the three types of modern agricultural behaviors influenced by digital empowerment and further test verifies the digital divide concerning scale, age, and region.

This article provides practical policy implications: On the one hand, we should accelerate the construction of digital infrastructure in rural areas, improve the digital literacy of farmers, and continue to give full play to the supporting role of Internet information technology in promoting the integration of small farmers into the development of modern agriculture. On the other hand, attention should be paid to the “double-edged sword” effect of ICT, policies should be made to narrow the digital divide between groups and regions and promote the development of inclusive modern agriculture that benefits smallholders.