ABSTRACT
This chapter presents a review of water allocation modeling studies and discusses sustainable water allocation in a river basin context from the perspective of game theory. The Nash-Harsanyi negotiation model is applied to the examination of several water allocation and management options, including unregulated withdrawal, allocation through agreed quota, and water rights and water pricing mechanisms. Some conclusions and policy implications are derived from the case study of the Yellow River basin and are applicable to other river basins for improving water management.
