AbstractWe use cooperative game theory to analyze the impact of three controversial pipeline projects on the power structure in the Eurasian trade of natural gas. Two of them, Nord Stream and South Stream, allow Russian gas to bypass transit countries, Ukraine and Belarus. Nord Stream’s strategic value turns out to be huge, justifying the high investment cost for Germany and Russia. The additional leverage obtained through South Stream, in contrast, appears small. The third project, Nabucco, aims at diversifying Europe’s gas imports by accessing producers in Middle East and Central Asia. It curtails Russia’s power, but the benefits accrue mainly to Turkey, while the gains for the EU are negligible.
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Bibliographic InfoPaper provided by Koc University-TUSIAD Economic Research Forum in its series Koç University-TUSIAD Economic Research Forum Working Papers with number 1224.
Length: 27 pages
Date of creation: Sep 2012
Date of revision:
Bargaining Power; Network; Trade links; Natural Gas;
Find related papers by JEL classification:
- L5 - Industrial Organization - - Regulation and Industrial Policy
- L9 - Industrial Organization - - Industry Studies: Transportation and Utilities
- O22 - Economic Development, Technological Change, and Growth - - Development Planning and Policy - - - Project Analysis
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-09-09 (All new papers)
- NEP-ARA-2012-09-09 (MENA - Middle East & North Africa)
- NEP-CIS-2012-09-09 (Confederation of Independent States)
- NEP-CWA-2012-09-09 (Central & Western Asia)
- NEP-ENE-2012-09-09 (Energy Economics)
- NEP-EUR-2012-09-09 (Microeconomic European Issues)
- NEP-GTH-2012-09-09 (Game Theory)
- NEP-PPM-2012-09-09 (Project, Program & Portfolio Management)
- NEP-TRA-2012-09-09 (Transition 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.:
- Waft Grais & Kangbin Zheng, 1996. "Strategic Interdependence in European East-West Gas Trade: A Hierarchical Stackelberg Game Approach," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3), pages 61-84.
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