| Summary: | The Prairie Pothole Region (PPR) of Western Canada is characterized by productive cropland, grasslands, and millions of ‘potholes’ caused by receding glaciers. These potholes fill up with water and form wetlands habitat that is a rich and valuable ecosystem, and is one of the most productive waterfowl habitats in the world. However, the social benefits from wetland ecosystems are not paid to farmers, whose lands support wetlands, leading farmers in the PPR of Canada to drain wetlands. Wetlands habitat in the PPR is also threatened by climate change, due to potentially drier conditions, as well as biofuel policies that are aimed at mitigating climate change (which increase the value of grains relative to wetlands). This research is comprised of four empirical papers that study the optimal level of wetlands retention, as well as the effect of potential future climate change on wetlands. The methods employed include bioeconomic modeling, which maximizes an economic objective (utility of cropping, harvesting ducks) subject to biological constraints (wetlands and waterfowl retention), as well as positive mathematical programming to develop a land use model. In the first paper, a previous bioeconomic model of optimal duck harvest and wetland retention is updated and extended to include the nonmarket value of waterfowl and the ecosystem service and other amenity values of wetlands. Results indicate that wetlands and duck harvests need to be increased relative to historical levels. In the second paper, regression analysis is used to determine the casual effect of climate change on wetlands in the PPR. The model developed in the first paper is then adapted to solve the socially optimal levels of duck harvests and wetlands retention under current climate conditions and various climate change scenarios. Results indicate that the optimal number of wetlands to retain could decrease by as much as 38 percent from the baseline climate. In the third paper, the earlier bioeconomic model is extended to include cropping decisions. ...
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