Equity in Risky Intertemporal Economic Environments – EquiRisk

We will use the framework proposed by the theory of fair social choice : the theory proposes to ground the aggregation of different dimensions of well-being in individuals' preferences. We will first further explore the method by applying it on happiness data and by better understanding the formation and the evolution of preferences.

We will then address the specific challenges raised by situations involving risks. One problem is to decide which preferences should be taken into account in that case, how to aggregate different “states of the world”, and more importantly how to jointly take into account inequalities in risks and in final consequences.

After tackling the problem at a general level, the project will study two more specific issues: climate change and human longevity, which both involve risk and time. Climate change raises the issue of intergenerational equity while the number of future generations is itself unknown and catastrophes may unfairly affect some of them. Human longevity raises the question of the cumulative effects of income and length of life inequalities. In both cases, the project will seek to identify public policies that can reduce the different sources of unfairness.

The aim of the project is to better understand inequalities in their different forms. The methodological contribution will be to develop tools to assess and evaluate inequalities. The project will also be a contribution to the ethical debate surrounding the definition of equity. We would like to emphasize the role of individual preferences in the definition of inequality.

Another contribution will be to develop methods to take into account the many dimensions of well-being, including health and environmental quality, in addition to monetary outcomes and risks. We aim at proposing coherent and systematic ways of designing composite indicators similar to the Human Development Index, but insisting on the role of individual preferences.We will also include time and risk in the definition of well-being and equity.

We hope that the project may have some impact for policymakers, public authorities or intergovernmental agencies like the IPCC or the OECD by providing a more comprehensive view of inequality.

The project has supported the creation of a research group on social choice at Collège d'Etudes Mondiales (FMSH). The group has strong international connections and works on problems of multi-disciplinary inetrest. The project will make it possible for the group to grow, to strengthen its collaborations with foreign partners (through seminar invitations and through a scientific committee) et to foster interdisciplinary work.

Eventually, the project may give rise to a new research proposal including the existing group but widening the core research questions through international and interdisciplinary collaborations.

Several working papers will be produced in the course of the project, and they will be made available on the website of the project. These working papers will be submitted to peer-reviewed journals or publish in books.

A seminar will also be set up to engage discussions with scholars from different disciplinary backgrounds about the multidimensional aspect of equity and the specific issues raised by the presence of risks. A synthesis of the project will be made during a final international conference gathering prominent scholars from various disciplines.

Equity is a multidimensional concept requiring the comparison of different aspects of well-being. This is even truer in modern “Risk Societies”, where equity has to be assessed in different possible or likely scenarios, over long periods. The aim of project EquiRisk is to develop methods and evaluation tools making it possible to coherently aggregate different dimensions of well-being in risky economic environments, so that we can assess the equity of individual situations.

To this end, we will use the framework proposed by the theory of fair social choice : the theory proposes to ground the aggregation of different dimensions of well-being in individuals' preferences. We will first further explore the method by applying it on happiness data and by better understanding the formation and the evolution of preferences.

We will then address the specific challenges raised by situations involving risks. One problem is to decide which preferences should be taken into account in that case, how to aggregate different “states of the world”, and more importantly how to jointly take into account inequalities in risks and in final consequences.

After tackling the problem at a general level, the project will study two more specific issues: climate change and human longevity, which both involve risk and time. Climate change raises the issue of intergenerational equity while the number of future generations is itself unknown and catastrophes may unfairly affect some of them. Human longevity raises the question of the cumulative effects of income and length of life inequalities. In both cases, the project will seek to identify public policies that can reduce the different sources of unfairness.

The results of project EquiRisk will appear on a website and in working papers (to be published in peer-reviewed journals) as the project develops. A seminar will also be set up to engage discussions with scholars from different disciplinary backgrounds about the multidimensional aspect of equity and the specific issues raised by the presence of risks. A synthesis of the project will be made during a final international conference gathering prominent scholars from various disciplines. A dissemination of the results of project EquiRisk directed at public authorities and international agencies will also be organized, in particular through the participation of one member of the group to the next IPCC report.