The heart of prospect theory is the value function, proposing that the carriers of value are positive or negative changes from a reference point. Daniel Kahneman observed that if prospect theory had a flag, the value function would be drawn on it. The function is nonlinear, reflecting diminishing sensitivity to magnitude. When describing how human lives are valued, the function exposes profound incoherence. An individual life is highly valued and thus vigorously protected if it is the only life at risk. But that life loses its value when it is one of many endangered by a larger tragedy. Beyond this insensitivity, the function may actually decline when many lives at risk become mere numbers. The more who die, the less we care. Implications of this deadly ‘arithmetic of compassion’ for understanding and managing the risk from nuclear weapons are briefly discussed.
