In heavily cleared agricultural landscapes, decline of biodiversity could be prevented by restoring native habitat. In this paper, we develop a spatially explicit bioeconomic model that optimizes ecological restoration of habitat for woodland-dependent birds in the Australian state of Victoria....

The choice of policy mechanisms for encouraging environmentally beneficial land-use change should depend on the relative levels of private (or internal) net benefits, and public (or external) net benefits. A map of recommended policy mechanisms is developed, depending on the relative levels of...