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Risk writ large

Thoma, Johanna and Weisberg, Jonathan (2017) Risk writ large. Philosophical Studies, 174 (9). pp. 2396-2384. ISSN 0031-8116

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Identification Number: 10.1007/s11098-017-0916-3

Abstract

Risk-weighted expected utility (REU) theory is motivated by small-world problems like the Allais paradox, but it is a grand-world theory by nature. And, at the grand-world level, its ability to handle the Allais paradox is dubious. The REU model described in Risk and Rationality turns out to be risk-seeking rather than risk-averse on one natural way of formulating the Allais gambles in the grand-world context. This result illustrates a general problem with the case for REU theory, we argue. There is a tension between the small-world thinking marshaled against standard expected utility theory, and the grand-world thinking inherent to the risk-weighted alternative.

Item Type: Article
Official URL: https://link.springer.com/journal/11098
Additional Information: © 2017 The Authors © CC BY 4.0
Divisions: Philosophy, Logic and Scientific Method
Subjects: B Philosophy. Psychology. Religion > B Philosophy (General)
Sets: Departments > Philosophy, Logic and Scientific Method
Date Deposited: 04 Jul 2017 15:04
Last Modified: 20 Nov 2020 03:08
URI: http://eprints.lse.ac.uk/id/eprint/83112

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