Water Diversion from the Great Lakes: Is a Cooperative Approach Possible?

Abstract

The concern about other states diverting water from the Great Lakes has prompted the Great Lakes States and provinces to adopt institutional arrangements that have effectively blocked any new diversions.Since the current arrangements do not allow diversions, important opportunities may be lost in the future. This article considers the possibility of 'economically desirable diversions' and how the gains should be allocated among the states and provinces to foster cooperation. The study shows that in most cases, new institutional arrangements will be needed before agreements can be reached. Game theory is used to determine how coalitions may be formed to reach cooperative agreements for diversions. Five different lake diversion games are tried involving Lake Ontario, Lake Superior, Lake Erie, Lake Michigan-Huron, and finally, all the lakes together. Diversions from Lake Ontario may offer the best opportunity for cooperation since there are no interlake effects.