Risk aversion, and the degree to which it is felt, is a personality trait with high variance between individuals and over the lifespan. To ignore it in a utility calculation would be absurd.
Maurice Allais should have listened to his homonym Alphonse Allais (no apparent relation), humorist and theoretician of the absurd, who famously remarked “La logique mène à tout à condition d’en sortir”.
Logic leads to everything, on condition it don’t box you in.
Risk aversion, and the degree to which it is felt, is a personality trait with high variance between individuals and over the lifespan. To ignore it in a utility calculation would be absurd. Maurice Allais should have listened to his homonym Alphonse Allais (no apparent relation), humorist and theoretician of the absurd, who famously remarked “La logique mène à tout à condition d’en sortir”. Logic leads to everything, on condition it don’t box you in.