Transboundary water sharing between an upstream and downstream country

Transboundary water sharing of many river basins in the world is drawing many regions into the worst possible water conflicts. This dissertation proposes that efficient allocation of water allocation between an upstream and a downstream country may result from the existence of altruism between the countries. But altruistic concerns are dependent on the other country's willingness to have a good political relationship. If both countries maintain favorable political relations with each other, then the upstream country will care about the impacts of its water diversion on downstream country's welfare. Changes in political relationship between the countries could also entice the upstream country to exercise its "credible threat" of unilateral diversion. In addition, insufficient water flow in the river basin may influence the water sharing allocation between the upstream and the downstream countries. In this dissertation, we demonstrate the conditions under which transfers from a water-abundant third country can further strengthen the water claims of a downstream country. This dissertation also illustrates the example of water sharing of the Ganges River between India and Bangladesh and relates the case study specifically to the results of the theoretical models.