Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/40165 
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dc.contributor.authorBuchholz, Wolfgangen
dc.contributor.authorSchymura, Michaelen
dc.date.accessioned2010-09-17-
dc.date.accessioned2010-09-22T10:07:04Z-
dc.date.available2010-09-22T10:07:04Z-
dc.date.issued2010-
dc.identifier.urihttp://hdl.handle.net/10419/40165-
dc.description.abstractExpected Utility theory is not only applied to individual choices but also to ethical decisions, e.g. in cost-benefit analysis of climate change policy measures that affect future generations. In this context the crucial question arises whether EU theory is able to deal with 'catastrophic risks', i.e. risks of high, but very unlikely losses, in an ethically appealing way. In this paper we show that this is not the case. Rather, if in the framework of EU theory a plausible level of risk aversion is assumed, a 'tyranny of catastrophic risk' (TCR) emerges, i.e. project evaluation may be dominated by the catastrophic event even if its probability is negligibly small. With low degrees of risk aversion, however the catastrophic risk eventually has no impact at all when its probability goes to zero which is ethically not acceptable as well.en
dc.language.isoengen
dc.publisher|aZentrum für Europäische Wirtschaftsforschung (ZEW) |cMannheimen
dc.relation.ispartofseries|aZEW Discussion Papers |x10-059en
dc.subject.jelQ54en
dc.subject.ddc330en
dc.subject.keywordutilitarianismen
dc.subject.keywordExpected Utility theoryen
dc.subject.keywordcatastrophic risksen
dc.subject.stwKlimaschutzen
dc.subject.stwKosten-Nutzen-Analyseen
dc.subject.stwErwartungsnutzenen
dc.subject.stwNaturkatastropheen
dc.subject.stwRisikoen
dc.subject.stwWahrscheinlichkeitsrechnungen
dc.subject.stwUtilitarismusen
dc.subject.stwTheorieen
dc.titleExpected Utility theory and the tyranny of catastrophic risks-
dc.type|aWorking Paperen
dc.identifier.ppn635312646en
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen
dc.identifier.repecRePEc:zbw:zewdip:10059en

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