I agree with your analysis. For a Pascal’s mugging to work, you need to underestimate how small Pr(your interlocutor is willing and able to change your utility by x) gets when x gets large. Human beings are bad at estimating that, which is why when we explicitly consider PM-type situations in an expected-utility framework we may get the wrong answer; it’s possible that there is a connection between this and the fact (which generally saves us from PM-like problems in real life) that we tend to round very small probabilities to zero, whether explicitly or implicitly by simply dismissing someone who comes to us with PM-type claims.
I agree with your analysis. For a Pascal’s mugging to work, you need to underestimate how small Pr(your interlocutor is willing and able to change your utility by x) gets when x gets large. Human beings are bad at estimating that, which is why when we explicitly consider PM-type situations in an expected-utility framework we may get the wrong answer; it’s possible that there is a connection between this and the fact (which generally saves us from PM-like problems in real life) that we tend to round very small probabilities to zero, whether explicitly or implicitly by simply dismissing someone who comes to us with PM-type claims.