Expected Utility theory is not only applied to individual choices but also to ethical decisions, e.g. in cost … 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 …

Weitzman-type stochasticity. We show that, under expected power utility, the model is fragile to heavy-tailed distributional … assumptions and we derive necessary and sufficient conditions on the utility function to avoid fragility. We solve our stochastic … economy-climate model for two cases with compatible pairs of utility functions and heavy-tailed distributional assumptions. We …

In the expected-utility theory of the monetary value of a statistical life, the so-called "dead-anyway" effect … risk increases with the initial level of risk. Their reasoning is based on differences in the marginal utility of wealth …

stochastic differential formulation of intertemporal recursive utility. The present class of utility functionals is generated by … a backward stochastic differential equation and incorporates preference for the local risk of the stochastic utility …