Economic perspectives on land use change and leakage

Land use change and leakage effects stemming from technological change, conservation programs, and other policy interventions have received considerable attention in the scientific literature in the past decade. Economists have offered important insights about these linkages, yet much of the analysis undertaken by the land change science community does not fully avail itself of these insights. Similarly, many of the economic contributions to this field have ignored important findings from the land change science community. This paper, written by an economist, seeks to better communicate to members of the land change science community the key economic mechanisms behind land use, leakage and spillovers and how they might contribute to shaping future analyses. It does so using a series of successively more complex economic models, with each new model illustrating the importance of an added economic channel for land use change. The paper concludes by revisiting key insights which have emerged from research in the land change science community and their implications for economists conducting research into land use change and leakage.