Feb 23 - David Lewis
University of Wisconsin-Madison
"Optimal Reduction of Habitat Fragmentation with Incentive-Based Policies"
The fragmentation of wildlife habitat has long been recognized as a principal threat to terrestrial biodiversity. In this paper, we develop a theoretical model to analyze the optimal restoration of forested landscapes when land quality is spatially heterogeneous and wildlife habitat is fragmented and socially valuable. We consider the policy scenario in which a conservation agency attempts to induce reforestation on a pre-defined set of fragmented landscapes using incentive-based policies, but does not know the opportunity costs of individual parcels. The important insight to emerge from the model is that solutions at or near corners are a strong possibility—either a small amount or all of the agricultural land on particular landscapes should be converted to forest. To clarify the optimal solution, we present a simulation of the effects of incentive-based policies on the spatial distribution of forests in South Carolina. The empirical methodology integrates an econometric model of land-use change with GIS-based landscape simulations. The empirical findings strongly support our conjecture regarding corner solutions and the optimal restoration policy is shown to have substantial efficiency gains over other approaches.
David Lewis is an Assistant Professor of Agricultural and Applied Economics at the University of Wisconsin, Madison. He received a PhD in Agricultural and Resource Economics in 2005 from Oregon State University, and his research focuses on land use, spatial modeling, biodiversity conservation, and regional development.