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Landscape Outcomes in a Model of Edge Effect Externalities: A Computational Economics Approach

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  • Dawn C. Parker

Abstract

This paper examines the impact of distance-dependent spatial externalities, referred to as "edge-effect externalities," on free-market equilibrium land use patterns. Under edge-effect externalities, maximization of production possibilities will depend on minimization of landscape fragmentation, implying that both the correct allocation and the correct arrangement of land uses will be necessary conditions for an economically efficient outcome. Using an agent-based cellular automaton model, this paper deminstrates that in an unregulated free-market without bargaining, both Pareto-efficient and inefficient equilibrium landscape patterns are possible. Initial configurations of firms, permanent geographic features, and transportation costs will impact final outcomes. Further, edge-effect externalities can produce economic landscapes which are more dispersed and fragmented than the pure Von Thunen outcome.

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Bibliographic Info

Paper provided by Santa Fe Institute in its series Working Papers with number 99-07-051.

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Date of creation: Jul 1999
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Handle: RePEc:wop:safiwp:99-07-051

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Keywords: Economic geography; spatial externalities; land-use;

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References

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  1. Tietenberg, T. H., 1974. "Derived decision rules for pollution control in a general equilibrium space economy," Journal of Environmental Economics and Management, Elsevier, vol. 1(1), pages 3-16, May.
  2. Freeman, A. III, 1984. "Depletable externalities and pigouvian taxation," Journal of Environmental Economics and Management, Elsevier, vol. 11(2), pages 173-179, June.
  3. Albers, Heidi J., 1996. "Modeling Ecological Constraints on Tropical Forest Management: Spatial Interdependence, Irreversibility, and Uncertainty," Journal of Environmental Economics and Management, Elsevier, vol. 30(1), pages 73-94, January.
  4. Helfand Gloria E. & Rubin Jonathan, 1994. "Spreading versus Concentrating Damages: Environmental Policy in the Presence of Nonconvexities," Journal of Environmental Economics and Management, Elsevier, vol. 27(1), pages 84-91, July.
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Cited by:
  1. Parker, Dawn Cassandra, 2000. "Edge-Effect Externalities: Theoretical And Empirical Implications Of Spatial Heterogeneity," Dissertations 11940, University of California, Davis, Department of Agricultural and Resource Economics.
  2. Parker, Dawn Cassandra & Munroe, Darla K., 2004. "Spatial Tests For Edge-Effect Externalities And External Scale Economies In California Agriculture," 2004 Annual meeting, August 1-4, Denver, CO 20000, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).

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