This paper aims to consider the meaning of the dismal theorem, as is presented by Professor Martin Weitzman. The theorem states that a standard cost–benefit analysis breaks down if there is a possibility of catastrophes occurring. This result has a significant influence on debates on the...

We employ the theory of rational choice to examine whether observable choices from feasible sets of prospects can be generated by the optimization of some underlying decision criterion under uncertainty. Rather than focusing on a specific theory of choice, our objective is to formulate a general...