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Fair allocation of riparian water rights

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  • Ricardo Martinez
  • Juan D. Moreno-Ternero

Abstract

We take an axiomatic approach to the allocation of riparian water rights. We formalize ethical or structural properties as axioms of allocation rules. We show that several combinations of these axioms characterize focal rules implementing the principle of Territorial Integration of all Basin States in various forms. One of them connects to the Shapley value, the long-standing centerpiece of cooperative game theory. The others offer natural compromises between the polar principles of Absolute Territorial Sovereignty and Unlimited Territorial Integrity. We complete our study with an empirical application to the allocation of riparian water rights in the Nile River.

Suggested Citation

  • Ricardo Martinez & Juan D. Moreno-Ternero, 2024. "Fair allocation of riparian water rights," Papers 2407.14623, arXiv.org.
    • Handle: RePEc:arx:papers:2407.14623
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    References listed on IDEAS

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    1. Biung†Ghi Ju & Juan D. Moreno†Ternero, 2017. "Fair Allocation Of Disputed Properties," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 58(4), pages 1279-1301, November.
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    6. Kilgour, D. Marc & Dinar, Ariel, 1995. "Are stable agreements for sharing international river waters now possible?," Policy Research Working Paper Series 1474, The World Bank.
    7. Hougaard, Jens Leth & Moreno-Ternero, Juan D. & Tvede, Mich & Østerdal, Lars Peter, 2017. "Sharing the proceeds from a hierarchical venture," Games and Economic Behavior, Elsevier, vol. 102(C), pages 98-110.
    8. Ansink, Erik & Weikard, Hans-Peter, 2009. "Contested water rights," European Journal of Political Economy, Elsevier, vol. 25(2), pages 247-260, June.
    9. Sylvain Beal & Amandine Ghintran & Eric Remila & Philippe Solal, 2013. "The River Sharing Problem: A Survey," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 15(03), pages 1-19.
    10. Billy A. Ferguson & Paul Milgrom, 2024. "Market Design for Surface Water," NBER Chapters, in: New Directions in Market Design, National Bureau of Economic Research, Inc.
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    12. Gudmundsson, Jens & Hougaard, Jens Leth & Ko, Chiu Yu, 2019. "Decentralized mechanisms for river sharing," Journal of Environmental Economics and Management, Elsevier, vol. 94(C), pages 67-81.
    13. René Brink & Arantza Estévez-Fernández & Gerard Laan & Nigel Moes, 2014. "Independence of downstream and upstream benefits in river water allocation problems," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 43(1), pages 173-194, June.
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