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Using vNM expected utility theory to facilitate the decision-making in social ethics

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  • Yanick Farmer

Abstract

The overall objective of this article is to demonstrate that in social ethics, certain problems related to decision-making are easier to resolve using conceptual tools borrowed from mathematics than using philosophical ethics theories, such as classical utilitarianism. With the help of a case study, the first part of the article will attempt to point out that if an agent bases his reasoning on the verbal and purely qualitative concepts of the classical utilitarian theory, he will find himself confronting 'undecidable' dilemmas, for which making a specific choice becomes almost arbitrary. The second part of the article proposes a more formal quantification of utility and attitude towards risk that can help the agent to overcome the uncertainties emanating from a strictly qualitative perception of the real world's configuration. This method for decision-making is inspired by the works of Howard Raiffa, John von Neumann and Oskar Morgenstern.

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  • Yanick Farmer, 2015. "Using vNM expected utility theory to facilitate the decision-making in social ethics," Journal of Risk Research, Taylor & Francis Journals, vol. 18(10), pages 1307-1319, November.
    • Handle: RePEc:taf:jriskr:v:18:y:2015:i:10:p:1307-1319
    DOI: 10.1080/13669877.2014.923024
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    1. Daniel Kahneman & Peter P. Wakker & Rakesh Sarin, 1997. "Back to Bentham? Explorations of Experienced Utility," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(2), pages 375-406.
    2. Fishburn, Peter C, 1989. "Retrospective on the Utility Theory of von Neumann and Morgenstern," Journal of Risk and Uncertainty, Springer, vol. 2(2), pages 127-157, June.
    3. Machina, Mark J, 1982. ""Expected Utility" Analysis without the Independence Axiom," Econometrica, Econometric Society, vol. 50(2), pages 277-323, March.
    4. Daniels, Norman & Sabin, James E., 2002. "Setting Limits Fairly: Can we learn to share medical resources?," OUP Catalogue, Oxford University Press, number 9780195149364.
    5. Harsanyi, John C., 1975. "Can the Maximin Principle Serve as a Basis for Morality? A Critique of John Rawls's Theory," American Political Science Review, Cambridge University Press, vol. 69(2), pages 594-606, June.
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    Cited by:

    1. Nelson Borges Amaral & Jinfeng Jiao, 2023. "Responses to Ethical Scenarios: The Impact of Trade-Off Salience on Competing Construal Level Effects," Journal of Business Ethics, Springer, vol. 183(3), pages 745-762, March.

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