Impact of Operating Scale on Factor Inputs in Grassland Animal Husbandry—Intermediary Effects Based on Market Risk

Abstract

The Chinese government has made the realization of sustainable development in grassland animal husbandry an important policy objective, and achieving a reasonable input of production factors is the key to realizing that goal. Based on the assumption of “rational economic man”, this study measures the economically optimal inputs and actual input bias of production factors, and constructs an econometric model focusing on analyzing the impact of operation scale on the factor input bias. The results indicate that herdsmen deviate from the economically optimal production input levels in forage, labor, and machinery, with the degree of bias decreasing as the livestock size or pasture size expands. Furthermore, it is established that market risk plays a role in mediating the impact of operation scale on the bias of variable production factors. Overall, large-scale herding households have a smaller bias in factor inputs, and should be promoted to operate on an appropriate scale, while paying attention to the prevention of market risk and the enhancement of information symmetry between herders and factor markets.