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Abstract

In this paper we study international river pollution problems. We introduce a model in which the agents (countries) located along a river derive benefit while causing pollution, but also incur environmental costs of experiencing pollution from all upstream agents. We find that total pollution in the model decreases when the agents decide to cooperate. The resulting gain in social welfare can be distributed among the agents based on the property rights over the river. Using principles from international water law we suggest 'fair' ways of distributing the property rights and therefore the cooperative gain.

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Bibliographic Info

Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 12-006/1.

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Date of creation: 19 Jan 2012
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Handle: RePEc:dgr:uvatin:20120006

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Web page: http://www.tinbergen.nl

Related research

Keywords: international river; pollution; externality; property rights; value;

Find related papers by JEL classification:

• C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
• D60 - Microeconomics - - Welfare Economics - - - General
• Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling

This paper has been announced in the following NEP Reports:

• NEP-ALL-2012-08-23 (All new papers)
• NEP-ENV-2012-08-23 (Environmental Economics)
• NEP-GTH-2012-08-23 (Game Theory)

References

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15. Rene van den Brink & Arantza Estevez-Fernandez & Gerard van der Laan & Nigel Moes, 2011. "Independence Axioms for Water Allocation," Tinbergen Institute Discussion Papers 11-128/1, Tinbergen Institute.
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Cited by:

1. Jorge Alcalde-Unzu & María Gómez-Rúa & Elena Molis, 2013. "Sharing the costs of cleaning a river: the Upstream Responsibility rule," Documentos de Trabajo - Lan Gaiak Departamento de Economía - Universidad Pública de Navarra 1301, Departamento de Economía - Universidad Pública de Navarra.
   
   • Jorge Alcalde-Unzu & Maria Gomez-Rua & Elena Molis, 2013. "Sharing the costs of cleaning a river: the Upstream Responsibility rule," ThE Papers 13/03, Department of Economic Theory and Economic History of the University of Granada..

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