Fairness, ambiguity and dynamic consistency

Bradley, Richard ORCID: 0000-0003-2184-7844 and Stefansson, H. Orii (2025) Fairness, ambiguity and dynamic consistency. Theory and Decision. ISSN 0040-5833

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Abstract

Considerations of dynamic inconsistency have figured prominently in debates over the rationality of preferences that violate the separability conditions characteristic of expected utility theory. These debates have mostly focused on risk- and ambiguity averse preferences, but analogous considerations apply to preferences for fairness. We revisit these debates in the context of a specific hypothesis regarding the violations of separability by such preferences, namely that they are potentially both explained and rationalised by non-instrumental attitudes to the chances of the various possibilities involved. Our main aim is to argue that, first, when these violations of static separability are motivated by such non-instrumental attitudes to chances, then they need not result in dynamically inconsistent behaviour. Second, and more generally, considerations of dynamic consistency do not, we argue, undermine the rationality of non-instrumental attitudes towards the distribution of chances, despite the fact that such attitudes give rise to violations of the static separability assumptions of expected utility theory.

Item Type:	Article
Additional Information:	© 2025 The Authors
Divisions:	Philosophy, Logic and Scientific Method
Subjects:	B Philosophy. Psychology. Religion > B Philosophy (General)
Date Deposited:	21 Nov 2024 11:15
Last Modified:	14 Feb 2025 17:03
URI:	http://eprints.lse.ac.uk/id/eprint/126120

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