Discussion Paper

Damming the Commons: An Empirical Analysis of International Cooperation and Conflict in Dam Location

Abstract

This paper examines whether countries consider the welfare of other nations when they make water development decisions. We estimate econometric models of the location of major dams around the world as a function of the degree of international sharing of rivers. We find that dams are more prevalent in areas of river basins upstream of foreign countries, supporting the view that countries free ride in exploiting water resources. We find weak evidence that international water management institutions reduce the extent of such free-riding.