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Chinese Journal of Management Science ›› 2020, Vol. 28 ›› Issue (1): 1-9.doi: 10.16381/j.cnki.issn1003-207x.2020.01.001

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A Cooperative Game Model for International Water Sharing Problems

WANG Xian-jia1,2, LIU Jia1   

  1. 1. School of Economics and Management, Wuhan University, Wuhan 430072, China;
    2. Institute of Systems Engineering, Wuhan University, Wuhan 430072, China
  • Received:2018-01-24 Revised:2018-10-12 Online:2020-01-20 Published:2020-01-19

Abstract: The scarcity of water resources leads to all kinds of conflicts and contradictions in international water sharing problems. Traditional gametheory models cannot be used to solve such problems when consideringthe effect of the flow of the river and the formation of coalitions between the players. In order to find a reasonable allocation scheme among all stakeholders for such problems, a cooperative game model is proposed and international water sharing problems are analyzed in which various stakeholders compete and cooperate with each other. In this paper, a dynamic bargaining model is used to find the worth of all coalitions. Then, by using the Nash bargaining method, the gains of players in each coalition are found. Finally, by comparing the total utility of all stakeholders under various schemes, the reasonable allocation for international water sharing problems can be found. Our research shows that:Influenced by the environment with externalities, partial cooperation among all stakeholders may be more effective than full cooperationscheme, and the optimal allocation in copetition scheme may be better than the optimal allocation in full cooperation scheme. When studying the problem of water resource allocation in flowing basins, the basic model and the solution of this paper can provide a reasonable distribution scheme when considering that coalitions can be formed between players and the worth of coalition have externalities.

Key words: international water allocation, game theory, externalities, cooperative game, Stackelberg model, Nash bargaining model

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