It is very important to control agricultural water pollution and promote agricultural water saving, for high-quality development of Yangtze River Economic Belt (YREB). The efficiency of agricultural green water utilization (EAGWU) needs financial and technical support from the new-type urbanization, which also change agricultural production mode and resource utilization level. This paper introduces non-point source water pollution into the output, adopts the super efficiency-slack model (SE-SBM) to measure the EAGWU, and uses difference generalized method of moments (DIF-GMM) to examine how new-type urbanization affects EAGWU from its four core characteristics. The results of EAGWU show that the overall efficiency value has been increasing rapidly in the research period, while the eastern provinces performed better and the central provinces performed worse. On the other hand, the overall difference in EAGWU first diverged and then shrunk, while economically developed provinces has been converging all the time. The results of driving factor estimation show that population urbanization has a significantly positive effect on EAGWU, with the rural labor force transfer and agricultural land circulation. Economic urbanization and urban-rural integration have negative effects, with the widening gap of absolute income and the compressed space of agricultural development. The EAGWU lag phase has a positive effect, because of the ratchet or cumulative effect, while equilibrium-urbanization has an insignificant effect. The conclusions will provide preferable recommendations for decision-making of green and water-saving development in agriculture.

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