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There seems to be some struggle here with defining u0 in a way that intuitively represents morality, so I'll take a jab at it. As I see it, u0 can be viewed as "the utlity debt of creating a life", that is to say the amount of utility a person has to generate over the course of their lifetime in order to morally justify their existence (with all of its effects on the UDNTs of others already accounted for in their calculation), reasonably assuming they get to live a full t0 life.

An intuitive (albeit extreme) proof of concept: Imagine a fetus (i.e. a pre-person at a stage where hypothetically everyone agrees they are not a moral patient) which is reliably predicted not to develop limbs (Tetra-Amelia Syndrome) and age rapidly (Progeria). It is widely morally agreed that this person should be pre-terminated, as their life would be short and full of misery. The suggested model reflects this intuition: this person's expected UDNT is significantly lower than u0, considering their expected Tdeath is low and their expected average h is mostly below h0.

As such, subtracting u0 from the formula makes sure that every life added to the population is worth living. Does this click with people's intuitions?


P.S.

I slightly worry that a development of this concept dabbles in eugenics in a way that may defeat the purpose of modeling ethics. The balance that should prevent eugenics is essentially another one of the many aspects reflected in h0, which is where we tend to dump most of the unsolved part of this model.