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Paper short abstract:

I’d like feedback on the abstract’s clarity, the critique of new institutional economics, and the integration of development economics. Does the case study on the Colorado River effectively support the argument? Are the policy implications clear and actionable for sustainable water governance?

Paper long abstract:

In 2023, seven U.S. states reliant on the Colorado River reached a historic agreement to reduce their collective water consumption by 3.5 million acre-feet, marking progress in collaborative governance during a 22-year drought. However, this temporary agreement, set to expire in 2026, highlights the ongoing difficulties of managing water resources under frameworks shaped by structural inequities and competing interests. This paper critiques the dominant paradigm of new institutional economics by applying its key methodological tool, the self-enforcement contract game, to explain why each state accepted the revised allocation of Colorado River water. Using the Colorado River negotiations as a case study, the analysis demonstrates that new institutionalism can effectively explain governance outcomes. Crucially, it also exposes the framework’s inability to address why water consumption in capitalist systems consistently exceeds ecological boundaries. Specifically, by employing the self-enforcement contract game—designed to resolve the tragedy of the commons—this study reveals that new institutional economics fails to confront systemic incentives that prioritize short-term profits over long-term sustainability. To address these shortcomings, the paper incorporates insights from development economics to propose an alternative framework for equitable and sustainable water governance. This interdisciplinary approach redefines water not simply as an economic commodity but as a vital resource for human development and ecological resilience.