Ecosystems involve interspecies interactions that can be influenced by human interventions. Prior work shows interventions that ignore these interactions cause efficiency-reducing ecosystem externalities. We show inefficiencies may also be attributable to nature, via interspecies interactions generating excessive competition or predation. Ecosystem management therefore may involve correcting both ecological and economic inefficiencies. We explore ecosystem management to correct ecological inefficiencies from predation. The inefficiencies are shown to be akin to anthropogenic externalities arising when humans harvest resources under open access conditions, and so the solution is to “regulate” predators. Viewing the ecological inefficiencies in this manner facilitates the choice of controls. We examine predator removal and predator exclosures that shelter prey from predation. Using a numerical example of the Great Lakes Piping Plover, an endangered bird, and Merlins, a falcon that predates on plovers, we find using predator exclosures can yield a win-win outcome that increases both prey and predator populations.


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