Swedish farmers receive around SEK600 million in annual support for managing semi-natural grazing lands, which are important for the preservation of biological and cultural values associated with the agricultural landscape. The principal aim of this report is to analyze the economic efficiency of the Swedish agri-environmental support scheme for grazing land. Alternative policies for preserving grazing land as well as policies used in other countries are also studied. Finally an analysis of the factors that influence farmers’ decisions to preserve grazing land is presented.