On a New Axiom of Dominance and Constructing a Measurable Value Function under Uncertainty

Evaluating Alternative Policies to Decrease Emission of Carbon Dioxide

Abstract

In this paper, we revise a previous axiom of dominance for constructing a measurable value function under uncertainty based on Dempster-Shafer theory of probability. The previous axiom of dominance has dealt with only the best and the worst results in the set element. In this paper we propose a new axiom of dominance after defining the value of the set element taking into account the average of the value of all the results included in the set element. We could construct a measurable value function under uncertainty for an ordinary, pessimistic or optimistic person, based on this new axiom of dominance. An example of evaluating the alternatives to regulate CO₂emission for avoiding global warming is included.