The paper provides a formal representation of goal systems. The focus is on three properties: consistency, conflict, and coherence. An aim is to attain conceptual clarity of these properties. It is argued that consistency is adequately regarded as a property relative to the decision situation or, more specifically, the set of alternatives that the agent faces. Moreover, as a condition of rationality, consistency is stronger than some writers have claimed. Conflict is adequately regarded as a relation over subsets of a (...) given goal system and should likewise be regarded as relative to the set of alternatives that the agent faces. Coherence is given a probabilistic interpretation, based on a support relation over subsets of goal systems. (shrink)

We construct a model of rational choice under risk with biased risk judgement. On its basis, we argue that sometimes, a regulator aiming at maximising social welfare should affect the environment in such a way that it becomes ‘less safe’ in common perception. More specifically, we introduce a bias into each agent’s choice of optimal risk levels: consequently, in certain environments, agents choose a behaviour that realises higher risks than intended. Individuals incur a welfare loss through this bias. We show (...) that by deteriorating the environment, the regulator can motivate individuals to choose behaviour that is less biased, and hence realises risk levels closer to what individuals intended. We formally investigate the conditions under which such a Beneficial Safety Decrease—i.e. a deteriorating intervention that has a positive welfare effect—exists. Finally, we discuss three applications of our model. (shrink)