Climate change and reindeer herding - A bioeconomic model on the impact of climate change on harvesting profits for Saami reindeer herders in Norway and Sweden

The Arctic is warming three times faster than the global average. Rising temperatures could reduce the snowcovered season and increase plant productivity in the spring, fall and summer. While this may increase carrying capacity of pastures and growth of semi-domesticated reindeer, rising temperatures could also lead to increase the frequency of ice-locked pastures, which may negatively affect reindeer body mass, survival, and reproductive success. We create a stage-structured bioeconomic model of reindeer herding that incorporates such counteracting effects of climate change on the economics of reindeer herding in Norway and Sweden. The model is calibrated using historical data on reindeer numbers and slaughter weights, in combination with historical weather data. We find that one more day with ice-locked pastures has a greater negative impact than the benefit of earlier spring. Then the model is used to simulate possible future economic impacts of three climate change scenarios, under different assumptions about herders' information about future weather conditions. The negative impact of icing outweighs any positive impact of earlier spring for all scenarios, and the potential loss is greater the less information herders have about future weather conditions.