Scope and Sustainability of Cooperation in Transboundary Water Sharing of the Volta River
AbstractThe paper explores the scope and sustainability of a self-enforcing cooperative agreement in the framework of a game theoretic model, where the upstream and downstream country, Burkina Faso and Ghana respectively in the Volta River Basin, bargain over the level of water abstraction in the upstream. In the model we consider the case where the downstream country, Ghana, offers a discounted price for energy export to the upstream country, Burkina Faso, to restrict its water abstraction rate in the upstream. The paper examines the benefits and sustainability of such self-enforcing cooperative arrangements between Ghana and Burkina Faso given stochastic uncertainty in the river flow. The findings of the paper suggest that at the present condition, the marginal benefit of Burkina Faso from increasing the water abstraction is much higher than that of Ghana’s marginal loss. However, the paper finds that if both countries’ water abstraction rates are at a much higher level, then the marginal loss of Ghana increases phenomenally from similar increase in water abstraction rate by Burkina Faso. Under such circumstances, there is an opportunity for Ghana to provide side payments in terms of discounted export price of power in order to motivate Burkina Faso to restrict water abstraction.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University of Bonn, Center for Development Research (ZEF) in its series Discussion Papers with number 43324.
Date of creation: 19 Sep 2008
Date of revision:
Bargaining; Cooperation; Transboundary; Uncertainty; Volta River Basin; Demand and Price Analysis; Environmental Economics and Policy; Risk and Uncertainty;
This paper has been announced in the following NEP Reports:
- NEP-AFR-2008-12-07 (Africa)
- NEP-AGR-2008-12-07 (Agricultural Economics)
- NEP-ALL-2008-12-07 (All new papers)
- NEP-ENV-2008-12-07 (Environmental Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Just, Richard E. & Netanyahu, Sinaia, 2000. "The importance of structure in linking games," Agricultural Economics, Blackwell, vol. 24(1), pages 87-100, December.
- Erik Ansink & Arjan Ruijs, 2008.
"Climate Change and the Stability of Water Allocation Agreements,"
Environmental & Resource Economics,
European Association of Environmental and Resource Economists, vol. 41(2), pages 249-266, October.
- Erik Ansink & Arjan Ruijs, 2007. "Climate Change and the Stability of Water Allocation Agreements," Working Papers 2007.16, Fondazione Eni Enrico Mattei.
- Edward Barbier, 2002.
"Water and Economic Growth,"
Centre for International Economic Studies Working Papers
2002-28, University of Adelaide, Centre for International Economic Studies.
- Carlo Carraro & Carmen Marchiori & Alessandra Sgobbi, 2006.
"Applications of negotiation theory to water issues,"
2006_09Classification-JEL, Department of Economics, University of Venice "Ca' Foscari".
- Carlo Carraro & Carmen Marchiori & Alessandra Sgobbi, 2005. "Applications of Negotiation Theory to Water Issues," Working Papers 2005.65, Fondazione Eni Enrico Mattei.
- Carraro, Carlo & Marchiori, Carmen & Sgobbi, Alessandra, 2005. "Applications of negotiation theory to water issues," Policy Research Working Paper Series 3641, The World Bank.
- Edward J Green & Robert H Porter, 1997.
"Noncooperative Collusion Under Imperfect Price Information,"
Levine's Working Paper Archive
1147, David K. Levine.
- Green, Edward J & Porter, Robert H, 1984. "Noncooperative Collusion under Imperfect Price Information," Econometrica, Econometric Society, vol. 52(1), pages 87-100, January.
- Green, Edward J. & Porter, Robert H., 1982. "Noncooperative Collusion Under Imperfect Price Information," Working Papers 367, California Institute of Technology, Division of the Humanities and Social Sciences.
- Ariel Rubinstein, 2010.
"Perfect Equilibrium in a Bargaining Model,"
Levine's Working Paper Archive
661465000000000387, David K. Levine.
- Bhaduri, Anik & Barbier, Edward B., 2008. "International water transfer and sharing: the case of the Ganges River," Environment and Development Economics, Cambridge University Press, vol. 13(01), pages 29-51, February.
- Spagnolo, Giancarlo, 2001. "Issue Linkage, Credible Delegation, and Policy Cooperation," CEPR Discussion Papers 2778, C.E.P.R. Discussion Papers.
- Bhaduri, Anik & Manna, Utpal & Barbier, Edward B. & Liebe, Jens, 2009. "Cooperation in transboundary water sharing under climate change," Discussion Papers 51303, University of Bonn, Center for Development Research (ZEF).
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search).
If references are entirely missing, you can add them using this form.