Can Issue Linkage Help Mitigate Externalities and Enhance Cooperation?

International Game Theory Review 14 (1): 39-59

25 Pages Posted: 11 Oct 2012 Last revised: 20 Jun 2013

See all articles by Kim Hang Pham Do

Kim Hang Pham Do

Massey University

Ariel Dinar

University of California, Riverside (UCR)

Daene McKinney

University of Texas at Austin

Date Written: June 15, 2011

Abstract

Managing transboundary river basins is never easy and usually involves conflicts. This paper introduces a special class of games with externalities and issue linkage to promote cooperation on transboundary water resources. The paper analyzes whether issue linkages can be used as a form of negotiations on sharing benefits and mitigating conflicts. It is shown that whenever opportunities for linkages exist, countries may indeed contribute towards cooperation. In particular, if the linked games are convex, the grand coalition is the only optimal level of social welfare.

Keywords: games with externalities, convexity, s-core, transboundary rivers, issue linkage, international water sharing agreement

JEL Classification: C71, C72, D62

Suggested Citation

Pham Do, Kim Hang and Dinar, Ariel and McKinney, Daene, Can Issue Linkage Help Mitigate Externalities and Enhance Cooperation? (June 15, 2011). International Game Theory Review 14 (1): 39-59. Available at SSRN: https://ssrn.com/abstract=2147136 or http://dx.doi.org/10.2139/ssrn.2147136

Kim Hang Pham Do (Contact Author)

Massey University ( email )

College of Business
School of Economics and Finance
Palmerston North, Manawatu PN 342
New Zealand
+64 6 3505799, ext. 84056 (Phone)
+64 6 3505660 (Fax)

HOME PAGE: http://www.massey.ac.nz/massey/expertise/profile.cfm?stref=705830

Ariel Dinar

University of California, Riverside (UCR) ( email )

900 University Avenue
Riverside, CA 92521
United States

Daene McKinney

University of Texas at Austin ( email )

2317 Speedway
United States

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