Game theory in the current flood protection

In recent years a considerable attention has been devoted to flood protection measures because of great damages caused by floods. While planning measures the consideration is based on costs and benefits associated with their implementation, i.e. the application of cost-benefit analysis (CBA). In most cases the relation of upstream and downstream in river catchments is neglected, therefore in the practice a potential for a retention of upstream remains unused. This bachelor thesis deals with a projection of this upstream/downstream relation into the current flood protection. Mathematic method of the game theory is used for the analysis of the optimal allocation of flood protection measures between the upstream/downstream areas. The upstream/downstream relation is defined by the specific assumptions and conditions. On the basis of these specific assumptions and conditions a payoff 2x2 matrix is modelled. The thesis constructs individual scenarios of mutual positions of these two parts. Possible outcomes are analysed by using game theory, while taking into account liability for damages, negotiation options and transaction costs. Presented results of individual scenarios indicate that the game theory is a suitable tool for the assessment of an optimal allocation of flood protection measures and its application in practice is appropriate in conjunction with other tools.