TY - JOUR
T1 - Computing alternating offers and water prices in bilateral river basin mangagement
AU - Houba, H.E.D.
PY - 2008
Y1 - 2008
N2 - This contribution addresses the fundamental critique in Dinar et al. [1992, Theory and Decision 32] on the use of game theory in river basin management: People are reluctant to monetary transfers unrelated to water prices and game theoretic solutions impose a computational burden. For the bilateral alternating-offers model, a single optimization program significantly reduces the computational burden. Furthermore, water prices and property rights result from exploiting the Second Welfare Theorem. Both issues are discussed and applied to a bilateral version of the theoretical river basin model in Ambec and Sprumont [2002, Journal of Economic Theory 107]. Directions for future research are provided. © 2008 World Scientific Publishing Company.
AB - This contribution addresses the fundamental critique in Dinar et al. [1992, Theory and Decision 32] on the use of game theory in river basin management: People are reluctant to monetary transfers unrelated to water prices and game theoretic solutions impose a computational burden. For the bilateral alternating-offers model, a single optimization program significantly reduces the computational burden. Furthermore, water prices and property rights result from exploiting the Second Welfare Theorem. Both issues are discussed and applied to a bilateral version of the theoretical river basin model in Ambec and Sprumont [2002, Journal of Economic Theory 107]. Directions for future research are provided. © 2008 World Scientific Publishing Company.
U2 - 10.1142/s0219198908001935
DO - 10.1142/s0219198908001935
M3 - Article
SN - 0219-1989
VL - 10
SP - 257
EP - 278
JO - International Game Theory Review
JF - International Game Theory Review
ER -