Intergenerational Preferences and Continuity: Reconciling Order and Topology

Abstract

In this paper we focus our efforts on studying how a preorder and topology can be made compatible. Thus we provide a characterization of those that are continuous-compatible. Such a characterization states that such topologies must be finer than the so-called upper topology induced by the preorder and, thus, it clarifies which topology is the smallest one among those that make the preorder continuous. Moreover, we provide sufficient conditions that allows us to discard in an easy way the continuity of a preference. In the light of the obtained results, we provide possibility counterparts of the a few celebrate impossibility theorems for continuous social social intergenerational preferences due to P. Diamond, L.G. Svensson and T. Sakai. Furthermore, we suggest quasi-pseudo-metrics as appropriate quantitative tool for reconciling topology and social intergenerational preferences. Thus, we develop a metric type method which is able to guarantee possibility counterparts of the aforesaid impossibility theorems and, in addition, it is able to give numerical quantifications of the improvement of welfare. We also show that our method makes always the intergenerational preferences semi-continuous multi-utility representables in the sense of Özgü Evern and Efe O. Ok. Finally, in order to keep close to the classical way of measuring in the literature, a refinement of the previous method is presented in such a way that metrics are involved.