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Assessing Risky Social Situations

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  • Marc Fleurbaey

    ()
    (CNRS-CERSES, University Paris 5, and IDEP)

Abstract

This paper analyzes social situations in the context of risk. A new argument is proposed in order to defend the ex-post approach against Diamond’s (1967) famous critique of Harsanyi’s (1955) utilitarian theorem. It leads to a characterization of the criterion consisting in computing the expected value of the “equal-equivalent”. Characterizations of the ex-post maximin and leximin criteria, as well as a variant of Harsanyi’s theorem, are also obtained. It is examined how to take account of concerns for ex-ante fairness within this ex-post approach. Related issues are also addressed, such as the rescue problem or preference for catastrophe avoidance.

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Bibliographic Info

Paper provided by Institut d'economie publique (IDEP), Marseille, France in its series IDEP Working Papers with number 0703.

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Length: 40 pages
Date of creation: Jan 2007
Date of revision: Jan 2007
Handle: RePEc:iep:wpidep:0703

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Keywords: Risk; Social Welfare; ex ante; ex post; Fairness; Harsanyi’s Theorem.;

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