A risk budget makes much more sense, once we consider it an exposure budget and consider logical decision theory. You and a community of identically thinking friends are deciding how much exposure between each other to tolerate. To the extent that your community is very large, homogeneous and hardly ever get exposed to outsiders, you have a threshold between exponential growth and exponential decay. Now if hypothetically some people got more utility from exposure, and you could perfectly coordinate, then those who gain more utility from interactions would interact more (assuming fungible utility.)
A risk budget makes much more sense, once we consider it an exposure budget and consider logical decision theory. You and a community of identically thinking friends are deciding how much exposure between each other to tolerate. To the extent that your community is very large, homogeneous and hardly ever get exposed to outsiders, you have a threshold between exponential growth and exponential decay. Now if hypothetically some people got more utility from exposure, and you could perfectly coordinate, then those who gain more utility from interactions would interact more (assuming fungible utility.)