Herder stocking rate and household income under the Grassland Ecological Protection Award Policy in northern China

The Grassland Ecological Protection Award Policy (GEPAP) is the largest payment for ecosystem services (PES) program targeting grasslands in China. It subsidizes households to reduce livestock numbers or ban the grazing of livestock to restrict the large-scale degradation of grasslands. While the GEPAP has drawn attention to these issues, questions regarding the performance of the GEPAP have still not been clearly answered. This research used a balanced dataset of 726 surveyed households from 5 regions of Inner Mongolia to assess the impacts of the policy on stocking rate and household income. Results indicated that contrary to the aim of the GEPAP, the overall stocking rate marginally significantly increased. Net household income extremely significantly decreased even though total income increased. Income from animals still formed the major proportion of household income, and off-farm income only played a complementary role in household income even though there was an increase in the amount and its proportion in total household income. Regression results indicated that the households with a lower subsidy level tended to have higher stocking rates and incomes. Stocking rate was unrelated to the policy or market price for livestock, while the household income was positively affected by livestock price. Results from this research have implications for the design, implementation and enforcement of conservation programs of grasslands in China and other developing countries.