Soil and water conservation programs of the U.S. Department of Agriculture (USDA) are under increasing scrutiny. Congress, interest groups, and departmental budget people are requesting systematic documentation of the impacts of these programs. Their basic concern is economic performance – the “payoff” for public dollars invested in conservation. This paper examines two aspects of the increasing application of economics to soil and water conservation policy. Both are discussed in the context of current efforts within USDA to implement the Soil and Water Resources Conservation Act of 1977. This new law provides a policy setting within which questions of economic performance are addressed. Examined first is use of formal analytical models in identifying economic consequences of alternative conservation strategies. Second, issues concerning economics of public choice are addressed. The first implies search for greater efficiency of resource use; the latter concerns the distribution of policy impacts in the political economy. Both are important. The paper concludes by identifying research needs. This is a policy paper, not a report of research results.