Water dissociation and the energetics of the WGS reaction on a bulk MgO, an Ag supported MgO thin film and Au/MgO/Ag surfaces is studied based on the density functional theory. The literature results for water splitting on MgO and MgO/Ag surfaces with a step type defect are repeated and further analysis on the origin of the energetically favored dissociative water adsorption are made. The reactivity towards water dissociation on the stepped MgO and MgO/Ag surfaces is attributed to four contributing factors: 1. The change in the interlayer distance of the surface in dissociative adsorption is diminished on the stepped surfaces compared to the flat surfaces. On the flat surfaces the dissociative adsorption of water leads to an increased interlayer distance between the first and second MgO layer while the molecular adsorption does not change the distance. 2. A surface OH group is formed in the H adsorption. On the stepped surface the adsorbed OH and surface OH form aligned dipoles. On the flat surface the adsorbed OH and the surface OH group do not align. 3. The density difference analysis shows that the charge transfer in the co-adsorption of H and OH on the stepped MgO/Ag surface is mainly between the adsorbed H and OH. This leads to an at- tractive Coulomb interaction between the adsorbed species. 4. The p-band center of the edge O atoms show a strong shift towards the Fermi energy compared to the average surface O atoms. On the bulk MgO surfaces the p-band center of the O atom at the H adsorption site is shown to correlate with the H adsorption energy. Similar trend is seen in the MgO/Ag surfaces. The energetics of a WGS reaction on a surface with large Au clusters deposited on an Ag supported MgO thin film is studied. The large Au cluster is modeled with an Au stripe set with the periodic boundary conditions to produce similar distances between the Au atoms as for a large Au cluster. The Bader charges of the edge atoms of the Au stripe are similar to the charges for the edge atoms of a large Au cluster. Water dissociation at the edge of the Au stripe is not deemed probable due to the weak binding of OH to the Au/MgO/Ag surface.