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Assessing risky social situations

By Marc Fleurbaey

Abstract

This paper re-examines the welfare economics of risk. It singles out a class of criteria, the “expected equally-distributed equivalent”, as the unique class which avoids serious drawbacks of existing approaches. Such criteria behave like ex-post criteria when the final statistical distribution of wellbeing 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

Topics: HB Economic Theory
Publisher: The Centre for Philosophy of Natural and Social Science (CPNSS), London School of Economics
Year: 2009
OAI identifier: oai:eprints.lse.ac.uk:27006
Provided by: LSE Research Online

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