Applying Game Theory to Water Conflicts in International River Basins

Nation-states rarely go to war over water but it isalso rare that water conflicts inan international river basin are resolved throughcooperation among the riparian countriesthat use the shared resources. One interpretation forthe lack of success is that the magnitude ofpotential gains from cooperation is largely unknownfor most international rivers and riparian countriesmay have an incomplete or even inaccurateknowledge of cooperative opportunities. In additiongains from cooperation will mean little to individualriparians unless the required cooperative behaviorsare incentive compatible. Game theory offers useful insights for assessingcooperative solutions for water conflicts ininternational river basins. Applying cooperative gametheory concepts such as core nucleolus and Shapleyvalue to Nile water conflicts we examine theincentive structure of both cooperative andnoncooperative strategies for different ripariancountries and establish some baseline conditions forincentive-compatible cooperation in the Nile basin.