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Value and Unacceptable Risk: Temkin's Worries about Continuity Reconsidered

Rabinowicz, Wlodek LU and Arrhenius, Gustaf (2005) In Economics and Philosophy 21(2). p.177-198
Abstract
Consider a transitive value ordering of outcomes and lotteries on outcomes, which satisfies substitutivity of equivalents and obeys ‘continuity for easy cases’, i. e., allows compensating risks of small losses by chances of small improvements. Temkin (2001) has argued that such an ordering must also - rather counter-intuitively - allow chances of small improvements to compensate risks of huge losses. In this paper, we show that Temkin's argument is flawed but that a better proof is possible. However, it is more difficult to determine what conclusions should be drawn from this result. Contrary to what Temkin suggests, substitutivity of equivalents is a notoriously controversial principle. But even in the absence of substitutivity, the... (More)
Consider a transitive value ordering of outcomes and lotteries on outcomes, which satisfies substitutivity of equivalents and obeys ‘continuity for easy cases’, i. e., allows compensating risks of small losses by chances of small improvements. Temkin (2001) has argued that such an ordering must also - rather counter-intuitively - allow chances of small improvements to compensate risks of huge losses. In this paper, we show that Temkin's argument is flawed but that a better proof is possible. However, it is more difficult to determine what conclusions should be drawn from this result. Contrary to what Temkin suggests, substitutivity of equivalents is a notoriously controversial principle. But even in the absence of substitutivity, the counter-intuitive conclusion is derivable from a strengthened version of continuity for easy cases. The best move, therefore, might be to question the latter principle, even in its original simple version: As we argue, continuity for easy cases gives rise to a sorites. (Less)
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author
organization
publishing date
type
Contribution to journal
publication status
published
subject
in
Economics and Philosophy
volume
21
issue
2
pages
177 - 198
publisher
Cambridge University Press
external identifiers
  • wos:000234067300001
ISSN
0266-2671
DOI
10.1017/S0266267105000556
language
English
LU publication?
yes
id
c671453d-1a2c-4554-b2c9-d6be414617d6 (old id 775093)
date added to LUP
2007-12-21 11:20:49
date last changed
2016-04-15 20:07:55
@article{c671453d-1a2c-4554-b2c9-d6be414617d6,
  abstract     = {Consider a transitive value ordering of outcomes and lotteries on outcomes, which satisfies substitutivity of equivalents and obeys ‘continuity for easy cases’, i. e., allows compensating risks of small losses by chances of small improvements. Temkin (2001) has argued that such an ordering must also - rather counter-intuitively - allow chances of small improvements to compensate risks of huge losses. In this paper, we show that Temkin's argument is flawed but that a better proof is possible. However, it is more difficult to determine what conclusions should be drawn from this result. Contrary to what Temkin suggests, substitutivity of equivalents is a notoriously controversial principle. But even in the absence of substitutivity, the counter-intuitive conclusion is derivable from a strengthened version of continuity for easy cases. The best move, therefore, might be to question the latter principle, even in its original simple version: As we argue, continuity for easy cases gives rise to a sorites.},
  author       = {Rabinowicz, Wlodek and Arrhenius, Gustaf},
  issn         = {0266-2671},
  language     = {eng},
  number       = {2},
  pages        = {177--198},
  publisher    = {Cambridge University Press},
  series       = {Economics and Philosophy},
  title        = {Value and Unacceptable Risk: Temkin's Worries about Continuity Reconsidered},
  url          = {http://dx.doi.org/10.1017/S0266267105000556},
  volume       = {21},
  year         = {2005},
}