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Assessing risky social situations

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  • FLEURBAEY, Marc

Abstract

This paper reexamines the welfare economics of risk. It singles out a class of criteria, the "expected equally distributed equivalent," as the unique class that avoids serious drawbacks of existing approaches. Such criteria behave like ex post criteria when the final statistical distribution of well-being is known ex ante and like ex ante criteria when risk generates no inequality. The paper also provides a new result on the tension between inequality aversion and respect of individual ex ante preferences, in the vein of Harsanyi's aggregation theorem. (c) 2010 by The University of Chicago. All rights reserved..

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Bibliographic Info

Paper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers RP with number -2289.

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Handle: RePEc:cor:louvrp:-2289

Note: In : Journal of Political Economy, 118(4), 649-680, 2010
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