Coral reefs face a diverse array of threats, from eutrophication and overfishing to climate change. As live corals are lost and their skeletons eroded, the structural complexity of reefs declines. This may have important consequences for the survival and growth of reef fish because complex habitats mediate predator-prey interactions [1, 2] and influence competition [3-5] through the provision of prey refugia. A positive correlation exists between structural complexity and reef fish abundance and diversity in both temperate and tropical ecosystems [6-10]. However, it is not clear how the diversity of available refugia interacts with individual predator-prey relationships to explain emergent properties at the community scale. Furthermore, we do not yet have the ability to predict how habitat loss might affect the productivity of whole reef communities and the fisheries they support. Using data from an unfished reserve in The Bahamas, we find that structural complexity is associated not only with increased fish biomass and abundance, but also with nonlinearities in the size spectra of fish, implying disproportionately high abundances of certain size classes. By developing a size spectrum food web model that links the vulnerability of prey to predation with the structural complexity of a reef, we show that these nonlinearities can be explained by size-structured prey refugia that reduce mortality rates and alter growth rates in different parts of the size spectrum. Fitting the model with data from a structurally complex habitat, we predict that a loss of complexity could cause more than a 3-fold reduction in fishery productivity.

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Phenotypic plasticity is one major source of variation in natural populations. Inducible defences, which can be considered threshold traits, are a form of plasticity that generates ecological and evolutionary consequences. A simple cost–benefit model underpins the maintenance and evolution of these threshold, inducible traits. In this model, a rank‐order switch in expected fitness, defined by costs and benefits of induction between defended and undefended morphs, predicts the risk level at which individuals should induce defences. Here, taking predator‐induced morphological defences in Daphnia pulex as a threshold trait, we provide the first comprehensive investigation into the costs and benefits of a threshold trait, and how they combine to reflect fitness and predict the switchpoint at which induction should occur. We develop reaction norms that show genetic variation in switchpoints. Further experiments show that induction can confer a survival benefit and a cost in terms of lifetime reproductive success. Together, these two traits combine to estimate expected fitness and can predict the switchpoint between an undefended and a defended strategy. The predictions match the reaction norm data for clones that experience these costs and benefits, and correspond well to independent field data on induction. However, predictions do not, and cannot, match for clones that do not gain a benefit from induction. This study confirms that a simple theory, based on life history costs and benefits, is a sufficient framework for understanding the ecology and evolution of inducible, threshold traits.