A conflict resolution model among municipal and agricultural users by game theory for sustainable operation of a common aquifer

Increasing demand for water due to population growth, increasing agricultural products and industrial users lead to the serious conflict among water users. Since the renewable water resources are limited, these conflicts will result in a continual race between the users to mine the resources, which create a disastrous situation. Game theory is a powerful equipment to optimize the system operation with more than one decision maker. The aim of this paper is to develop a dynamic conflict resolution model to resolve conflicts among aquifer operators and determine the sustainable equilibrium points.
In this paper, base on the level of aquifer operators’ cooperation 3 scenarios have been considered: I. Non-cooperative static game,
II.Non-cooperative dynamic game and III. Full cooperation. To compare the results of these scenarios, operation of a hypothetical common aquifer used by municipality and agricultural operators has been studied. Results show that the benefits of cooperative behavior are more than non-cooperative models. Proposed dynamic game increases global benefits 20% with respect to static game theory.

JEL Classification: C11, C72, C73, Q25, Q34