Two Level Negotiations in Bargaining Over Water
The paper analyzes the impact of a two-level game for water allocations. For a model with two domestic groups and two countries, and with both domestic and international negotiations, Nash bargaining theory is used to derive several propositions on the consequences of different bargaining rules for water allocations. The effect on international negotiations of the ability to commit to having domestic negotiations is examined. The importance of the nature and timing of complementary investments, and whether they are included in negotiations, in affecting the efficiency of the negotiated outcome is also explored.
KeywordsWater Allocation Bargaining Game International Negotiation Domestic Investment Nash Bargaining Solution
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