Game Theoretical Analysis of Water Allocation Rule in Lower Basin of Euphrates and Tigris Rivers

The research is devoted to investigation of the water allocation rule effectiveness in Euphrates - Tigris River basin in Iraq with regard to behavior of a reservoir operator and farmers. The information about water supply to the farmers in a coming year is provided to them by the reservoir operator. Thus they may assume that the reservoir operator does not communicate to them with 100 % certainty the real type of future water supply. Consequently, the farmers have good reasons not to fully trust the reservoir operator´s announcement and they make their decisions based on their own belief. This kind of interactive decision making process has been modeled by employing the extensive form of non-cooperative game theory. The analysis reveals the picture of decision making and its effect on benefits of the basin stakeholders. The result provides suggestions regarding some aspects of future institutional design for better governance.