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Regime shifts are substantial reorganizations in system structure, functions and feedbacks, which can lead to changes in the provision of ecosystem services with significant impacts on human well-being. Recent research has documented cases of regime shifts in local and regional systems and there is mounting concern about regime shifts of global significance. In this paper we discuss management of social–ecological systems in light of the potential for regime shift. Management that increases system resilience and lowers the probability of regime shifts is beneficial when regime shifts are likely to reduce human well-being. It may not always be possible to avoid harmful regime shifts, so building capacity to adapt should a regime shift occur is beneficial too. Adaptive management can help reduce uncertainty about the likelihood of regime shifts, how this likelihood can be affected by management action, and the impact of regime shifts on well-being. Linking scientific understanding with decision-making is important but distributional consequences can impede decision making and action.

The purpose of this article is to contribute to the exploration of non-convex dynamics in coupled human-nature systems. We study welfare issues associated with the management of a human-nature complex adaptive system with a threshold and a stochastic driver. We exemplify with a specific system where we link changes in the number and diversity of birds to the abundance of a pest (insects) that causes damages to goods and services valuable to human beings. We present a method that simplifies the analysis and helps us discuss different management models that combine direct and indirect controls of the pest. This allows us to show that 1) the choice of control method depends in a highly non-linear way on biodiversity characteristics and 2) the socially optimal outcome may not be reachable using price instruments. Hence the price vs. quantity debate needs to be revisited using a complex adaptive system lens.