Contract farming supply chain empowered by the low-altitude economy: Technology investment decisions, cost sharing, and social welfare

Focusing on a contract farming supply chain empowered by the low-altitude economy, this paper constructs a Stackelberg game model composed of an acquisition firm and a farmer. By incorporating key variables such as low-altitude investment costs, technology transformation efficiency, and consumer technology preference, we comparatively analyze the optimal decisions and social welfare under three scenarios: no government subsidy, government subsidy to the farmer, and government subsidy to the firm. The results indicate that: First, regardless of whether the government subsidy recipient is the farmer or the firm, the optimal output, low-altitude investment level, and profit distribution among supply chain members are identical in equilibrium; the policy difference lies solely in the timing and cost of fund execution. Second, a reduction in low-altitude investment costs or an improvement in technology transformation efficiency is not always beneficial to the farmer. An excessively high technology substitution rate grants the firm strong bargaining power, enabling the firm to capture technology dividends by suppressing the procurement price, thereby causing the farmer's profit to exhibit an inverted U-shaped trend of increasing first and then decreasing. Third, government subsidies are not always effective. When consumer preference for new technology agricultural products is high or technology costs are moderate, the market mechanism can already achieve optimal allocation; consequently, intervention at this stage would suppress total social welfare. The conclusions of this study provide a theoretical basis for the government to optimize agricultural subsidy strategies regarding the low-altitude economy and for the firm to formulate sustainable procurement mechanisms.