The path to fair water allocation is often determined by an evaluation of policy outcomes and interstate bargaining
I just came across some work I did a couple of years ago at the New York University on the politics of the distribution of the Nile River. It includes aspects of “cake-cutting-procedures” and game theoretic approaches. A line of thought and Pandora’s box which is still very inspiring and stimulating with regard to water allocation today.
Water allocation might seem relatively easy from a purely technical point of view. We can optimize river flows to different stakeholders such as hydropower, agriculture, industry, domestic water use, and environment. If one includes the social and political-economic dimension of water allocation, it gets far more difficult. There might be linkages to social, political and religious issues which go far beyond the assumption that allocation outcomes are simply based on inter–comparisons of economic utilities. In my short exercise about the Nile River Basin I developed a game theoretic model following the argument that the value of water is primarily determined by an evaluation of interstate policy outcomes and interstate bargaining. The short exercise concludes that “Based on the condition of non–diminishing basin–wide social welfare, a resulting water allocation balances out the hydro–political differences among nations.”
Access the short paper here: http://lucas-beck.ch/wordpress/wp-content/uploads/2015/10/FairDivisionPaper.pdf or download it below.