Meadow restoration sequesters significant amounts of carbon (C). To date, no meadow-based restoration projects have been implemented as offset-generating commercial C projects. This article develops and parameterizes an economic model of meadow restoration-based C projects using belowground C data from meadow restoration projects in the Sierra Nevada Mountains and the Great Basin in the western United States. Results suggest that some meadow restoration projects are likely to be financially viable as commercial C projects, while others are not, with financially-viable projects netting between $70,000 and $170,000 over a forty-year project life. Projects are more likely to be financially viable when offset prices are higher, implementation costs are lower, sequestration rates are higher, and a larger area of meadow is restored per length of treated stream channel. Results also indicate that all meadow restoration projects are socially efficient when sequestered carbon is valued at the social cost of C.

AbstractClimate change‐induced shifts in snow storage and snowmelt patterns pose risks for adverse impacts to people, the environment, and irrigated agriculture. Existing research primarily focuses on evaluating these risks to irrigated agriculture at large scales, overlooking the role of local context in shaping risk dynamics. Consequently, many “at‐risk” areas lack insight into how adaptation strategies for managing risk through water supply augmentation or water conservation vary across contexts and over time. To address this gap, we develop a comprehensive index for evaluating irrigated agriculture's risk and adaptation potential to changes in snow at local scales and apply it throughout the western US. Results confirm trends toward escalating risk for changes in snow storage and snowmelt patterns over the century. However, substantial heterogeneity in the extent and drivers of risk exists due to variability in localized interactions between declines in water supply (approximately −9% ± 13% by 2100) and increased agricultural demand (approximately 7% ± 5% by 2100). Despite an existing focus on supply augmentation as a critical adaptation strategy to reduce risk, we show its effectiveness diminishes for many areas over time, declining to an average of −54% of historical augmentation potential by 2100. Conserving water through historical changes in crop acreage and type emerges as a more stable adaptation measure, reducing demand by 7%–8% regardless of time. While particularly relevant for higher elevation, less intensive agricultural settings in snowmelt‐dependent regions, findings underscore the need for strategies that support local‐scale, context‐appropriate adaptation to effectively manage escalating risk as snow changes.

Climate-induced declines in snowpack storage have profound consequences for snowmelt-dependent river basins globally, including those in the western United States. These basins face the risk of economic losses in agriculture and environmental damage due to disrupted instream flows. To mitigate these potential losses, two strategies are commonly employed: enhancing built reservoir storage capacity and increasing groundwater use during the irrigation season. However, implementing these strategies carries the risk of exacerbating instream flow disruptions and compromising the sustainability of aquifers. This article develops a hydro-economic optimization model of Nevada's Walker River Basin (WRB) and uses it to examine the impact of storage capacity and groundwater management on mitigating economic losses in agriculture caused by altered snowmelt-driven inflows. The model accounts for environmental constraints on instream flows that limit water availability for agricultural use. Results show that the WRB is projected to experience a decline in irrigated farm acreage and agricultural output due to reduced snowpack storage. The findings also indicate diminishing returns on reservoir capacity investments, while highlighting the increased value of these investments when groundwater pumping is constrained due to aquifer sustainability concerns. Results show that upgrading existing reservoir capacity by not more than 1.5% in a free water leasing market could protect upwards of 94% and 83% of baseline agricultural income when the basin faces future climate-induced early season snowmelt-driven flow timing, and reduced streamflow, respectively, while managing the basin for hydrologic and environmental constraints.

The concepts of resilience and resistance (R&R) have been used to improve wildland fuel treatment outcomes by identifying parts of the landscape that are more likely to respond well to treatment. This study examined how the economic benefits and costs of fuel treatments in sagebrush (Artemisia spp.) ecosystems varied with the resilience and resistance properties of the treatment site. Generalized ecological models were developed for the economic analysis of fuel treatments that integrated ecological succession, annual grass invasion, pinyon–juniper expansion, and wildfire to simulate ecosystem dynamics over time. The models incorporated resilience and resistance by varying model parameters related to each plant community’s ability to resist annual grass invasion and recover post-disturbance. Simulations produced estimates of the expected (ex ante) benefit–cost ratio for each treatment. The approach also considered the benefits associated with the system remaining in an ecologically favorable condition, allowing us to report a more holistic measure of the net economic benefits of fuel treatments. The results from the simulations indicated fuel treatment was economically efficient in late-successional sagebrush and early-successional juniper in mountain big sagebrush associations. For sagebrush associations where treatment was economically efficient, higher R&R status sites had higher benefit–cost ratios. The results suggested that treatment costs were more determinative of economic efficiency than treatment benefits.

This review synthesizes the scientific literature on fuel treatment economics published since 2013 with a focus on its implications for land managers and policy makers. We review the literature on whether fuel treatments are financially viable for land management agencies at the time of implementation, as well as over the lifespan of fuel treatment effectiveness. We also review the literature that considers the broad benefits of fuel treatments across multiple sectors of society. Most studies find that fuel treatments are not financially viable for land management agencies based on revenue generated from forest products, biomass, or carbon credits at the time of implementation. Fuel treatments also tend to not be financially viable based on future management costs savings (fire suppression and rehabilitation costs) or averted losses in forest products from wildfire over the lifespan of treatment effectiveness. Similarly, most studies that consider benefits beyond those accruing to land management agencies find that the benefits from any single category (e.g., damage to structures and infrastructure, critical watersheds, air quality, or ecosystem values) are not sufficient to offset treatment costs. Overall, the recent literature suggests that fuel treatment projects are more likely to have benefits that exceed costs if they generate benefits in multiple categories simultaneously. The literature also documents tremendous variability in benefits and costs across regions and between projects within regions, which poses a challenge to reaching general conclusions about the benefits and costs of fuel treatments at programmatic scales, and suggests that practitioners should proceed with caution when trying to extrapolate the benefits and costs for a prospective fuel treatment project from estimates reported in the previous literature.

This article develops economic models for a cow-calf ranching operation and an alfalfa hay operation in the Humboldt River Region (HRR) that use surface water for irrigation. The models were built and parameterized through consultation with ranchers and farmers in the HRR in order to represent typical agricultural operations in the region. The models were used to calculate the economic value to an operation of an acre-foot of water not received due to an unanticipated supply reduction. This analysis was conducted to support the conjunctive management of surface and groundwater in the HRR by providing estimates of the economic value of the water that surface water users expect but do not receive due to interference from upstream groundwater pumping. For the cow-calf ranch model, reduced water deliveries impact ranch profits by reducing the amount of low-cost feed grown on the ranch. The increase in average feed costs forces the ranch to reduce its herd size, which lowers the number of new calf births and, as a result, lowers future profits from livestock sales. The cow-calf ranching model predicts an economic value of an acre-foot of water for the cow-calf ranch in the range of $215 per acre-foot for unanticipated supply interruptions that occur in normal water years, and upwards of $290 per acre-foot for supply interruptions that occur during drought. Model results do not provide evidence that the economic value of an acre-foot of water increases with the length of the unanticipated supply reduction. For the alfalfa hay farm model, results indicate that unanticipated reduced water deliveries impact farm profits by first preventing the farm from planting a cover crop during fallow years and then, for more significant interruptions, reducing its acreage of alfalfa hay. The alfalfa hay model predicts that the economic value of an acre-foot of water increases with both the volume of water not received and the length of the unanticipated supply reduction. The economic value of water per-acre-foot predicted by the alfalfa hay model ranges from less than $10 per acre-foot for unanticipated supply interruptions that occur in normal water years, in the range of $100-$200 per acre-foot for single-year supply interruptions that occur during a below average water year, and over $300 per-acre-foot for supply interruptions that occur in successive below average water years.

Social comparisons for water conservation are often implemented in conjunction with a broader set of drought management policies. We investigate the interaction of social comparisons with prior responses to voluntary appeals for water conservation using a large-scale field experiment in Reno, Nevada. We develop a new social comparison framed as performance toward a conservation goal in contrast to the traditional comparison made in gallons. Our new social comparison decouples the performance relative to the peer group from baseline water use, allowing us to investigate the role of the peer comparison independently from baseline water use. Using a traditional and our new social comparison, we investigate prior conservation and baseline water use as drivers of heterogeneous response to social comparisons. Baseline water drives treatment heterogeneity in the traditional social comparison, while prior conservation drives treatment heterogeneity the new social comparison. The results indicate that under-performance relative one’s peers is critical for generating water conservation. Simple targeting of both types of social comparisons can increase aggregate savings by 38% because our new social comparison generates conservation among a different set of households compared to the traditional social comparison.

Continued provision of low-cost municipal and industrial water is anticipated to be a challenge for cities in the coming decades. To address this, many are considering large-scale infrastructure projects to expand their water supply. In this article, we develop a general equilibrium model to evaluate the economy-wide distributional impacts of water infrastructure projects. The model framework includes a regulated water utility with a cost-recovery mandate and captures the trade-off between the immediate costs of financing infrastructure projects and the long-term costs that water scarcity imposes on the regional economy. We apply the model to an on-going water infrastructure project in Las Vegas, Nevada.

This article analyses homeowners’ decisions to undertake fire-safe investments and create defensible space on their property using a unique dataset from 35 wildland–urban interface communities in Nevada. The dataset combines homeowner information from a mail survey with their observed fire-safe investments obtained through parcel-level hazard assessments. We find that homeowners’ self-reported mitigation expenditures are driven by their subjective beliefs about their wildfire risk, whereas observed defensible space status is driven by their costs of investment. We develop a theoretical model of a homeowner’s fire-safe investment decision that accounts for our empirical results.

Millions of hectares of sagebrush/bunchgrass rangeland in the western United States are undergoing type conversion to systems dominated by introduced annual grasses that proliferate after wildfire. Postfire rehabilitation and restoration are problematic in these complex systems, but restoration difficulties are exacerbated by high annual and seasonal variability in precipitation and persistent drought. Successful restoration of compositional, structural, and functional diversity in these weather-limited systems may require relatively long-term, iterative management that incorporates flexibility in the definition of the aspirational/goal state. Restoration planning should also explicitly accommodate a lack of predictability of individual-year management results and expectations of only partial success of individual-year management treatments. This planning environment may require rapid assessment and contingency planning in the short term but also long-term persistence to overcome expected failures and setbacks. New methodologies are needed to increase biodiversity without damaging previously established plants, and new metrics need to be developed to monitor successional trajectories between initial and multiple-potential goal states.

This article considers how the appropriate policy to promote defensible space should differ between wildland-urban interface (WUI) communities by analyzing the extent that the two prominent explanations for socially inefficient underinvestment in defensible space hold in 35 WUI communities in Nevada. We find that homeowners underinvest in defensible space due to externalities in communities whose predominant vegetation is associated with elevated wildfire hazard. We do not find evidence that homeowners are underinvesting in defensible space because they systematically misjudge the biophysical determinants of their wildfire risk or the efficacy of defensible space at reducing their wildfire risk.

This article develops a theoretical model to analyze the impact of policies to promote defensible space - the most prominent wildfire risk mitigation strategy on private property - on the overall level of defensible space in a community when homeowners' investment decisions are spatially dependent. The model describes how spatial dependencies can arise as a result of three externalities associated with defensible space: risk externalities, visual seclusion externalities, and externalities related to the interdependence of post-fire home values. The results suggest that the impact of policy on the equilibrium level of defensible space in a community will depend on the character of the spatial dependencies between neighboring homeowners' investments, as well as on the pre-policy equilibrium. The results also emphasize the importance of financial considerations in homeowners' defensible space investment decision.

Introductions of nonnative invasive species can harm ecosystems, heighten the risk of native species extinctions and population reductions, and lead to substantial economic damages on a worldwide scale. Increasingly, economists have made contributions that help other researchers, policymakers, and society better understand the economic implications of invasive species as well as the most economically efficient approaches for managing them. The complexity of invasive species management problems has pushed economists to ask novel economic questions and to develop new analytical approaches in order to address specific policy questions. There are three areas, in particular, where the economic analysis of invasive species management has led to significant innovations. First, there are substantial challenges to quantifying economic damages from invasive species for application in benefit−cost analysis. The challenges relate to defining the counterfactual state of an invaded ecosystem with and without management/policy and to the fact that, in a given ecosystem, estimates of economic damages are available for only a subset of the species and for only a subset of damages for any one species. Recent economic research has proposed innovative approaches to systematically dealing with these two issues in the context of invasive species that have implications for applied benefit−cost analysis more broadly. Second, unique among natural resource management problems, invasive species have the feature that their current and future extents are directly tied to a country’s participation in international trade. This feature has led to innovative research into the design of efficient measures to prevent or delay invasive species introductions along national borders, and into the trade-offs between these measures and the use of border controls as protectionist tools. The issues of optimal inspection policy and the use of nontariff barriers as a form of covert protectionism both have implications beyond invasive species management. Third, researchers have developed bioeconomic models that integrate economic and biological factors in order to analyze strategies to more cost-effectively reduce the damages caused by invasive species. These modeling efforts have dealt with issues related to temporal and spatial dynamics of the biological invasions, imperfect information regarding the extent of the invasion and the effectiveness of management, linkages between management applied at different stages of an invasion, and complications arising from ecosystems’ crossing over ecological thresholds due to invasions. In the face of increasingly rapid ecosystem change due to global climate change, increases in extreme weather, urban encroachment into wild lands, and other factors, many of these features of invasive species management problems are likely to become features of ecosystem management more broadly in the near future if they are not so already.

Our model shows that how consumers adjust their water or electricity use in response to social-comparison messages (SCM), and the welfare impacts of SCM, depend on the behavioral mechanism driving conservation and whether consumers’ water/energy use is at satiation.

This chapter describes how economic models can inform management of exotic annual Bromus species on rangelands in the Western United States. It surveys published studies that develop bio-economic models of the management of Bromus species and other exotic annual invasive grasses, focusing on the challenges of representing the complex dynamics of rangeland ecosystems within tractable models of economic decision-making. The discussion starts with elements that are common to most economic models of Bromus management, then turns to contributions from the literature that have developed bio-economic models that capture three salient features of Bromus invasion: the dynamics of Bromus invasion, ecological thresholds related to Bromus, and spatial interdependencies in biophysical and human systems. The chapter synthesizes insights gained from this literature for managing Bromus in the Western United States, including insights on where to direct Bromus management resources on the landscape to achieve the greatest benefit given limited funds for management and on how to improve the design of policies that encourage socially efficient Bromus management by private land managers. The chapter concludes by identifying key areas where further research into the economics of Bromus management is needed.

This article uses a unique data set on private homeowners’ observed investments in defensible space for 35 wildland-urban interface (WUI) communities in Nevada to analyze how the appropriate policy to promote defensible space, if any, should differ between WUI communities. To analyze this issue, we assess the extent to which three prominent explanations for homeowner underinvestment in defensible space hold in the WUI communities in our sample. We find evidence that homeowners are likely underinvesting in defensible space due to risk externalities in WUI communities whose predominant vegetation is associated with elevated wildfire hazard, that public expenditures on wildfire suppression capacity depress private investment in defensible space, but that public expenditures on hazardous fuel reduction promote private investment in defensible space in communities with high average fuel loads. We find no evidence that homeowners are underinvesting in defensible space because they systematically misjudge its efficacy, but we do find evidence that homeowners may not perfectly understand the biophysical determinants of their wildfire risk JEL Classification: D80, Q54, R20

In this article, we develop a simulation model of the benefits and costs of managing the ponderosa pine forest ecosystem in the southwestern United States. Using the model, we evaluate and compare the economic benefits and costs of ecological restoration and hazardous fuel reduction treatments. Both treatment approaches increase the expected number of low-severity wildfires, which can promote postfire rehabilitation. Hazardous fuel reduction treatments are likely to reduce expected wildfire suppression costs, but not enough to offset the costs of implementing treatments. Conversely, ecological restoration treatments do not necessarily reduce expected wildfire suppression costs but fully restore the ecosystem in more than half of the simulation runs, which lowers the need for future fire suppression and reduces the chance of conversion to nonforest, alternative stable states. We find that the choice between hazardous fuel reduction and ecological treatments will depend on the management objective being pursued, as well as on site-specific factors such as the wildfire return interval and the economic value of biomass removed.

The Great Basin is the largest North American desert, covering more than 49.6 million ha (122.5 million ac), and includes most of Nevada, a large part of Utah, and smaller sections of Oregon, Idaho, and California. Two of the biggest threats to ecosystem stability and integrity in the Great Basin are invasive annual grasses, particularly cheatgrass (Bromus tectorum L.), and expansion of native woody plants, particularly juniper (Juniperus spp.) species and pinyon pines (Pinus monophylla Torr. and Frém. and Pinus edulis Engelm.). An estimated 72% (36 million ha [88 million ac]) of the Great Basin is currently impacted by cheatgrass (Pellant et al. 2004). Pinyon and juniper woodlands currently occupy approximately 22.5 million ha (55.6 million ac) throughout the western United States (Miller et al. 2011). In the Great Basin alone, the occupied area is nearly 7.1 million ha (17.5 million ac), the result of a 125% to 625% increase in tree distribution, much of which occurred in areas where these species were not inherent components of the plant community (Miller et al. 2008). The alteration of native plant communities by these invasive species can increase the likelihood of damaging and dangerous wildfires that change the hydrologic system and degrade…

This article considers optimal livestock management on sagebrush rangeland in the presence of invasive plants, wildfire, and reversible and irreversible ecological thresholds. We find that ranchers operating on healthy rangeland have sufficient private incentive to maintain rangeland health, while ranchers operating on degraded rangeland will pursue rehabilitation only if treatment success rates are improved or treatment costs reduced relative to current levels. We also find that if ranchers do not understand the relationships among grazing pressure, vegetation treatments, and rangeland ecological dynamics, their management will result in higher shortrun profits, but lower long-run profits, and greater ecological degradation.