In river systems, costly upstream pollution abatement creates downstream welfare gains. Absent
adequate agreement on how to share the gains, upstream regions lack incentives to reduce pollution
levels. We develop a model that makes explicit the impact of water quality on production
benefits and suggest a solution for sharing the gains of optimal pollution abatement, namely the
Shapley value of an underlying convex cooperative game. We provide a decentralized implementation
through a smart contract to automate negotiations. It ensures a socially optimal agreement
supported by fair compensations to regions that turn to cleaner production from those that pollute.