An ecological-economic model for agri-environmental policy analysis

Operational models of economic activity, particularly at the farm scale, have become commonly used, and widely accepted methods and applications exist. Operational models of ecological systems probably have less of a history but processes of species interaction and succession are well documented. Relationships between economic farm-scale variables and resultant ecological diversity, however, are less well documented as are modelling frameworks which combine both economic and ecological operational systems. This paper explains how a utility maximising economic modelling framework may be linked to an ecological modelling system with the objective of allowing `ex ante' assessment of the ecological impact of certain key agricultural management parameters. Two models, initially designed for independent analyses, are introduced. Data pertaining to a survey of farm sites are used to demonstrate the types of relationships which emerge between agricultural management parameters and grassland vegetation. A specific case-study site is selected for ecological and economic assessment under potential policy scenarios. The results of the analysis highlight the relevance of such an integrated modelling system for environmental policy decision support.