A Bargaining with Negotiation Cost for Water Use and Pollution Conflict Management

Abstract

The intensifying overexploitation of water resources and the increasing pollution discharge have exacerbated conflicts in water resource utilization, making it urgent to effectively reconcile the contradiction between water resource utilization and environmental protection. This study developed a Cost-Inclusive Multi-Objective Bargaining Methodology (CIMB), coupled with a Compromise Programming (CP) method, to address conflicts between water use and pollution discharge, considering the economic benefits and the sustainable development of water resources. A deterministic multi-objective bargaining approach was employed, with two players representing the maximization of water use benefits and the minimization of total pollution discharge. This study takes the middle and lower reaches of the Han River region as an example to optimize water resource allocation in ten cities in this area. Using the CIMB-CP model, the water use and pollution discharge for different cities were obtained, and the impact of various factors on the game outcomes was analyzed. The model results indicate that negotiation cost have a significant impact on the Nash equilibrium solution. Compared to the Cost-Exclusive Multi-Objective Bargaining Methodology (CEMB) model, the Nash equilibrium solution of the CIMB-CP model shows an approximately 0.1% decrease in economic benefits and an approximately 0.3% decrease in pollution discharge. The risk attitudes of the participants have a significant impact on the game outcomes, and decision-makers need to formulate corresponding negotiation strategies based on their own risk preferences.