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Policies for Habitat Fragmentation: Combining Econometrics with GIS-Based Landscape Simulations

Habitat fragmentation is widely considered a primary threat to biodiversity. In this paper, we analyze incentive-based policies designed to reduce forest fragmentation in the coastal plain region of South Carolina. Our approach integrates an econometric model of land use with simulations that predict the spatial pattern of land-use change. We analyze how subsidies for afforestation affect distributions defined over fragmentation metrics and derive the marginal costs of altering landscape patterns. We find the costs of reducing fragmentation vary greatly with initial landscape conditions and that a simple uniform subsidy performs well relative to a more complicated spatially targeted policy. (JEL R14, R52)