However, as I said in a recent comment, people do not actually have utility functions. So in that sense, they have neither a bounded nor an unbounded utility function. They can only try to make their preferences less inconsistent. And you have two options: you can pick some crazy consistency very different from normal, or you can try to increase normality at the same time as increasing consistency. The second choice is better. And in this case, the second choice means picking a bounded utility function, and the first choice means choosing an unbounded one, and going insane (because agreeing to be mugged is insane.)
This is all basically right.
However, as I said in a recent comment, people do not actually have utility functions. So in that sense, they have neither a bounded nor an unbounded utility function. They can only try to make their preferences less inconsistent. And you have two options: you can pick some crazy consistency very different from normal, or you can try to increase normality at the same time as increasing consistency. The second choice is better. And in this case, the second choice means picking a bounded utility function, and the first choice means choosing an unbounded one, and going insane (because agreeing to be mugged is insane.)
Yes, that’s true. The fact that humans are not actually rational agents is an important point that I was ignoring.