The effects of a subsidy for grassland protection on livestock numbers, grazing intensity, and herders' income in inner Mongolia

Primary data from 262 pastoral households in Inner Mongolia are analyzed to determine the effects of a subsidy for grassland protection on livestock numbers, grazing intensity, and herders' income. Econometric models are estimated to determine the effects of the subsidy on each component of the intensity ratio (sheep-equivalent livestock units and grassland). Results suggest the subsidy increased the quantity of grassland controlled by the household. However, the effects on livestock units are mixed, with two of the four studied prefectures (Ordos and Ulanqab) showing a positive response, and two (Hulunbuir and Xilingol) showing a negative response. Inserting the parameter estimates from the livestock, grassland, and income functions into a structural model of grazing intensity, results suggest each 1% increase in subsidy reduces grazing intensity by between 0.168% and 0.532% depending on the prefecture, and increases herders' income by between 0.144% and 0.670%. By way of comparison, each additional year of education increases herders' income by 8.7% and reduces grazing intensity by 3.6%. Thus, education is not to be overlooked as a policy tool for achieving conservation goals.