Formalization and Applications of the Precuationary Principle
AbstractA formalization of the Precuationary Principle is given here: We formalize scientific knowledge on the likelihood of events in the state space and the concepts of scientifically unambiguous events and acts. We gie a definition of non-precautionary social planner as a Savage Expected Utility maximizer who evaluates acts relativ to a baseline, called “business as usual”, and who disregards scientifically ambguous acts, and we show that, for a wide class of preferences for the representative agent, non-r-precautionary decision making is sub-optimal. A discussion of this formalization is given in the context of national and international debates on Precaution, in the fields of Climate Change, of WTO arbitrages, and of the safety regulations of chemical products.
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Bibliographic InfoPaper provided by Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) in its series Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) with number 2002009.
Date of creation: 01 Feb 2002
Date of revision:
Ambiguity; objectively unambiguous; precaution;
Other versions of this item:
- Claude Henry & Marc Henry, 2002. "Formalization and applications of the Precautionary Principle," Working Papers hal-00243001, HAL.
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
- K32 - Law and Economics - - Other Substantive Areas of Law - - - Environmental, Health, and Safety Law
This paper has been announced in the following NEP Reports:
- NEP-ALL-2002-06-13 (All new papers)
- NEP-LAW-2002-06-13 (Law & Economics)
- NEP-MIC-2002-06-17 (Microeconomics)
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