UNION - Consider an average 2 percent return from most livestock ranching investments, and you wonder what keeps western ranchers in the saddle.
As it turns out, lots of different people are home on the range for much the same reason. From the small hobby ranch to the trophy spread to the large family corporation, most western ranchers agree that their foremost reason to run a ranch is the quality of life, according to an Oregon State University survey.
"This has important consequences for rangeland policies," said John Tanaka, an economist at OSU's Agriculture Research Station. "Economic models that attempt to explain rancher behavior based only on the profit motive can lead to poorly conceived land-use polices and policy assessments."
Yet, according to Tanaka, policy assessments continue to use livestock production as a measure of ranching success, even though rates of return from livestock operations are low by any standard investment criteria.
Tanaka surveyed 2,000 ranchers who lease western rangeland from the federal government, to better understand who they are and what keeps them on the ranch. In a recent article in the Journal of Range Management, Tanaka and Brad Gentner, a former graduate student in agricultural and resource economics at OSU, reported the social and economic characteristics of these ranchers and gauged their responses to policy changes.
"Because ranching occurs in a variety of physical settings, among ranchers from a broad spectrum of income levels and perspectives, a policy that is applied to all situations is likely to fail in many specific cases," Tanaka said. "Financial incentives won't be effective if financial reward is not the thing that ranchers value the most."
"This was an eye-opener for economists, who like to have everything reduced to numbers," said Tanaka, whose study was part of a larger project conducted with researchers in Idaho, Nevada, Utah, Wyoming, and New Mexico.
Working from his office at the Eastern Oregon Agricultural Research Center in Union, Tanaka helps ranchers sort out their values and goals through development of "ranch models." These models simulate the effects of the choices ranchers make about cattle, forage, landscape, economics, and way of life on a particular ranch.
The results from one year are fed into the simulation for the following year, so ranchers can fast-forward across generations to predict the consequences of various management choices and policies.
Eventually, Tanaka will combine groups of ranch models into community models that may help predict how the future of local ranches will affect rural communities in eastern Oregon.
"As ranchers face more restrictions on federal lands, it is important to understand how new policies will affect the land and the lives of eastern Oregon communities," said Tanaka.