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Nobel Prizes and Irrigation Ditches: Some Thoughts about Thomas Schelling, Social Conflict, and Water Organizations by David M. Freeman Professor Emeritas, Department of Sociology, Colorado State University On October 10, the Royal Swedish Academy of Sciences announced its decision to award the No- bel Prize in Economic Sciences jointly to Thomas C. Schelling and Robert J. Aumann. Dr. Schelling, after having taught 20 years at Harvard University's John F. Kennedy School of Government, now is on the faculty of the School of Public Policy at the University of Maryland, College Park. Professor Aumann serves at the Center for Rationality, Hebrew University, Jerusa- lem, Israel. Tom Schelling is a game theorist who worked within the context of the deep international polarization of the cold war years. His Strategy of Conflict (1960) and Arms and Influence (1966) became classics that were received as much more than economic studies. They were analyses of underlying processes that had application in the several social sciences and would inform scholars in sociology, political science, and anthropology for decades to come. Many economists have treated persons as individual decision - makers seeking preference satisfaction without reference to their position in social organizational networks. People have been viewed by them as being free to trade away the things they do not want to get the things they do without consideration of family ties, organizational rules, or other network constraints. Dr. Schelling, an economist by training, began with the sociologists' premise –i.e., people's choices are fundamentally conditioned by their position in networks of social organizational interaction. Schelling saw that a single individual can seldom determine what will happen in a given choice situation. Rather, individual people engage in interaction in ways that modify each other's prospects –i.e., what one does, or is expected to do, conditions the actions of another. The essence of game theory is the systematic study of strategic interaction. Alternatively stated, game theory is about how com- peting players can attempt to get what they want in a conflict situation via some degree and kind of coopera- tion constrained by the shape of the network in which they find themselves. It is posited that lessons can be applied in all kinds of social interactional settings whether in arms races or among rival water users. In real -world situations finding ways to rationally obtain objectives can be difficult in any single conflict game framework; it is fundamental that cooperation will be easier to obtain and sustain when the play- ers must face each other in future multiple encoun- ters–i.e., when they know that they cannot escape each other in the future. Robert Aumann, mathematician, earned his share of the prize because he: a) employed mathematical tools to concisely draw out specific hypotheses; and b) provided ways to study repeated strategic interactions among rational players over many game encounters. Why are sociologists, political scientists, and an- thropologists indebted to these prize winners? What possible application could all this have to the real world of water organization, conflict, and cooperation? Basically, what game theorists of several varieties have repeatedly demonstrated is that what is perfectly rational for each individual player seeking to maxi- mize personal goal achievement will, under specified conditions, be perfectly disastrous for the community of players. Game theory has logically established that —under specified conditions frequently found in the real world- - individual rationality will not lead to collective rationality. Let us look at a simple example. Two individually rational farmers ponder the possibility of building an improved watercourse for channeling irrigation water to their adjacent fields. The total cost of the improve- ment is, shall we say, $600. However, the benefits to farmer A equal only $400 while those to farmer B amount to $500. From the standpoint of their collec- tive joint benefit, the improvement should be made – they collectively would enjoy $900 of benefits, well in excess of the $600 cost. However, if each farmer only looks at his or her privately captured benefits neither will build the improvement. Each farmer individually does better not contributing to the common good while hoping that the other –in an economically irrational but altruistic move –will build the improvement and thereby allow the non - contributing member in this game to enjoy benefits of increased water supply and