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Economic and Political Considerations in Regional Cooperation Models

Author

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  • Dinar, Ariel
  • Wolf, Aaron

Abstract

Cooperation among players requires a realization of economic benefits to all players and a meeting of efficiency requirements through economically driven allocations. Cooperation among political (and sometimes hostile) players may not meet these requirements. Political considerations, usually ignored in economic analyses, can hinder or even block possible arrangements. A framework is proposed that includes both economic and political considerations for evaluating transfers or trades of scarce resources. This method quantifies both the economic payoffs using n-person game theory and the political likelihood of any of the coalitions actually forming, using the PRINCE Political Accounting System. The economic-political approach is applied to a case of a potential water transfer in the western Middle East. Results suggest that incorporating political considerations in the analysis stabilizes the regional solution suggested by economic-related allocations.

Suggested Citation

  • Dinar, Ariel & Wolf, Aaron, 1997. "Economic and Political Considerations in Regional Cooperation Models," Agricultural and Resource Economics Review, Cambridge University Press, vol. 26(1), pages 7-22, April.
    • Handle: RePEc:cup:agrerw:v:26:y:1997:i:01:p:7-22_00
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    Citations

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    Cited by:

    1. Gichuki, Francis & McCornick, Peter G., 2008. "International experiences of water transfers: relevance to India," IWMI Conference Proceedings 235175, International Water Management Institute.
    2. Kelly Tiller & Paul Jakus, 2004. "Explaining Cooperation in Municipal Solid Waste Management," Working Papers 2004-07, Utah State University, Department of Economics.
    3. Encarna Esteban & Ariel Dinar, 2013. "Cooperative Management of Groundwater Resources in the Presence of Environmental Externalities," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 54(3), pages 443-469, March.
    4. Yu Chen & Anthony G. O. Yeh & Yingxuan Zhang, 2017. "Political tournament and regional cooperation in China: a game theory approach," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 58(3), pages 597-622, May.
    5. Bar-El Raphael, 2006. "Assessing Regional Cooperation in the Middle East," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 12(1), pages 70-82, September.
    6. Marianna Khachaturyan & Karina Schoengold, 2019. "Applying Interconnected Game Theory to Analyze Transboundary Waters: A Case Study of the Kura–Araks Basin," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 5(01), pages 1-32, January.
    7. Bar-El Raphael, 2005. "A Typology of Regional Cooperation Projects," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 11(2), pages 193-207, November.
    8. Miki Malul & Raphael Bar-El & Dafna Schwartz, 2010. "Patterns of Cooperation in High-Tech—Constraints, Feasibility, and Benefits: Results of a Study among Palestinians and Israelis," Conflict Management and Peace Science, Peace Science Society (International), vol. 27(1), pages 67-84, February.
    9. Tiller, Kelly & Jakus, Paul M., 2005. "Applying the Miceli Model to Explain Cooperation in Municipal Solid Waste Management," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 34(2), pages 1-9, October.
    10. Sidibe, Y. & Williams, T.O., 2018. "A comparative analysis of water pricing options on two large-scale irrigation schemes in West Africa," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 276017, International Association of Agricultural Economists.
    11. Bar-El Raphael & Schwartz Dafna, 2003. "The Potential Effect of Peace on Regional Economic Cooperation in the Middle East," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 9(1), pages 1-33, January.

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