Economic policies for agriculture continue to shift from traditional trade and commodity specific approaches to focus more on natural resource management and environmental services. Agro-ecosystems are now a primary focus of economic policy discourse about sustainable development and policy makers increasingly seek analysis that is timely and sufficiently accurate to make informed decisions. Bio-economic management models, including whole-farm models, are among the important tools to assist the decision making process, scaling up from individual farms to include broad landscape. Bio-economic models summarize knowledge and make testable predictions in ways that help formulate practical advice. For example, over the past decade, MIDAS (Model of an Integrated Dryland Agricultural System) has become a well established, influential tool for research prioritization, extension, education and policy advice in Western Australia. This paper examines the strengths, weakness and applications of bio-economic models to assess the economic and environmental outcomes across agricultural landscapes. The paper considers public-private tradeoffs and the often competing, conflicting goals between local and national level decision makers. Examples include economic impacts of new crops and pasture species, stubble conservation, deep tillage, greenhouse gas sequestration by tree crops, mitigation of dryland salinity, fluctuation of commodity prices, and integration of perennial forage shrubs in farming systems in face of major environmental changes.