We ought to have two different terms for ‘concavity of utility function’ and ‘Allais-paradox-like behaviour’; having risk-adverse meaning both is too likely to lead to confusion.
Concavity of utility function = diminishing marginal utility.
Edit: That should probably be convexity, but you should also have said convexity.
(I usually specify whether I mean concave upwards or concave downwards because I can never remember the standard meaning of convave by itself...)
We ought to have two different terms for ‘concavity of utility function’ and ‘Allais-paradox-like behaviour’; having risk-adverse meaning both is too likely to lead to confusion.
Concavity of utility function = diminishing marginal utility.
Edit: That should probably be convexity, but you should also have said convexity.
(I usually specify whether I mean concave upwards or concave downwards because I can never remember the standard meaning of convave by itself...)