Economics of vegetation clearing in Queensland

Vegetation management in Queensland has been controversial in recent years. This is because of the complexity of the issues, the different interests of the various stakeholders, and the difficulty of finding efficient and acceptable solutions. While vegetation clearing generates production benefits to landholders it may also generate spillover effects of greenhouse gas emissions and biodiversity losses on other groups in society. As well, there are questions about impacts on sustainability where clearing is associated with risks of salinity and other land degradation impacts. This paper provides an overview of these issues from an economic perspective. Economic theory and applied results are used to explore reasons for disagreement over clearing and where the balance between private and public interests might lie. The use of regualtion, property right mechanisms, taxes and community planning are discussed to address problems associated with externalities. The need for better information, changed goals and norms, and regulation are outlined in relation to sustainability issues. The justification for some different approaches to regulation is also explored.