Risk and Sustainability: Is Viability that far from Optimality?

Michel de Lara, Vincent Martinet and Luc Doyen ()

Working Papers from HAL

Abstract: Economic analysis addresses risk and long-term issues with dis-counted expected utility, focusing on optimality. Viability theory is based on sustainability constraints to be satis ed over time, focusing on feasibility. We make a bridge between these two approaches by showing that viability is equivalent to an array of degenerate inter-temporal optimization problems. This makes the approach more inter-pretable in economic terms, and especially regarding efficiency. First,the deterministic case is examined. A particular emphasis is put on the connections between the viability kernel and the minimal time of crisis function. Then, we present stochastic viability with the notions of viable scenario and maximal viability probability. We show that the maximal viability probability shares dynamic programming properties with optimal discounted expected utility. Thus, both exhibit time-consistency, which may be a basis for an axiomatization of criteria under risk and long run for public decision-making.

Keywords: Sustainability; uncertainty; multicriteria; viability (search for similar items in EconPapers)
Date: 2010
Note: View the original document on HAL open archive server: https://hal.science/hal-04140924
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://hal.science/hal-04140924/document (application/pdf)

Related works:
Working Paper: Risk and Sustainability: Is Viability that far from Optimality? (2010)
Working Paper: Risk and Sustainability: Is Viability that far from Optimality? (2010)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:wpaper:hal-04140924

Access Statistics for this paper

More papers in Working Papers from HAL
Bibliographic data for series maintained by CCSD ().