ABSTRACT
This chapter introduces basic notions of game theory for water diplomacy practitioners. Using the maintenance of an internationally shared dam as an illustrative example, the discussion illustrates the potential for game theory to capture some of the key dynamics of many water diplomacy applications. We show how expected utility theory can be leveraged to codify the relationship between the objectives, decision variables and constraints that drive the considered problem. Principles from non-cooperative game theory can then be leveraged to understand how each party’s decisions can affect the other party’s constraints and their ability to meet their objectives. These dependencies, in turn, might allow us to identify barriers to collaboration and design mechanisms to overcome them and realize the full benefits of cooperative water management. Cooperative game theory can finally be leveraged to share these benefits in a fair and stable way. The chapter concludes with a brief discussion on how game theory can support water diplomacy.
