# Bargaining Power in Cooperative Resource Allocations Games
## 3 A Real-World Example: The Caspian Sea International Conflict
While, multiple scholarly works have been developed to determine the fair and likely mechanism for sharing the Caspian Sea [41,42], these studies: (1) only consider the governance mechanisms suggested by the negotiating parties, overlooking the opportunity of developing and recommending new resolutions; (2) do not simultaneously consider the exomoons and endogenous bargaining powers of the negotiating parties; and/or (3) fail to recognize the Caspian Sea's valuable environmental resources in addition to its energy resources. This study bridges the gap of previous studies by trying to identify new cooperative solutions for the allocation of the Caspian Sea environmental and energy sources among the littoral countries while taking the impacts of the exogenous and endogenous bargaining powers of the parties into consideration using weighted cooperative game theory methods. Since cooperative game theory methods consider each party's gain in case of non-cooperation, as an essential input, the first step to finding a solution for conflict resolution in the case of the Caspian Sea is to determine the status-quo shares of the littoral states. The Caspian Sea Negotiation Support System (NSS) [43] provides a spatial distribution of oil and gas resources across the Caspian Sea using a 200 \(\times\) 300 pixels map (Figure 2). One can use this NSS to estimate the value of the current shares of the littoral states from the sea and its resources. We used the 1940 treaty between Iran and USSR as the basis for estimating the status-quo shares. Based on this treaty, one can assume that the resources within ten miles (nautical) of each country's shoreline constitute its non-cooperative share. We used three different scenarios as the basis of valuation of the countries' non-cooperative shares within their marine territories:  
* Scenario 1: What matters to the countries the most is their areal shares. So, they negotiate over their areal shares regardless of their gains from the energy and environmental resources. * Scenario 2: What matters to the countries is the value of energy resources that can eventually secure for themselves without being concerned about their areal and environmental shares as well as. * Scenario 3: What matters to the countries is the total value their shares from the energy and environmental resource of the Sea regardless of their corresponding areal shares from the sea. Following [35; 44], the corresponding values of the shares as specified above was calculated using the Caspian Sea NSS (Table 1). Based on the estimated values, Kazakhstan has the highest non-cooperative areal share of the sea, followed by Russia and Iran. This is because these countries have the longest shorelines. When it comes to the monetary values of their shares from the sea resources, however, both the order and differences between the values (in percentage) change. In this case, again Kazakhstan has the highest share, followed by Turkmenistan and Iran. When compared in terms of percentages, Russia and Azerbaijan have a very small share of the sea energy and environments resources in the non-cooperative case due to the limited availability of oil and gas fields in their status-quo marine territories. Comparison of the values under Scenarios 2 and 3 suggests that the monetary value of environmental resources of the sea are insignificant when compared to the monetary values of oil and gas resources [45]. This can be mainly blamed on the method of valuation of environmental resources in comparison to energy resources with clear market prices. Estimating the asymmetric bargaining powers of negotiating parties is necessary for calculating their cooperative shares based on the proposed method in this study. We used the previously estimated weights of the barging powers [42; 46] based on the Data Envelopment Analysis (DEA) using a range of socio-economic and political criteria outlined in Table 2. We normalized those weights, ensuring that the summation of all weights would be equal to one (Table 3) to make them applicable in this study.