Yeah, this is a good point. In the mathematical argument it simply has to be assumed as an input that the response is the same over at least a several-thousand-dollar span. But does that seem to bear out in the data about real humans? I think so. If you have a bunch of people who exhibit similar apparent risk aversion, spread out over a variety of wealths and dispositions, it seems like it would be a miracle for them to all be just below the level of wealth where they’d change their minds.
Yeah, this is a good point. In the mathematical argument it simply has to be assumed as an input that the response is the same over at least a several-thousand-dollar span. But does that seem to bear out in the data about real humans? I think so. If you have a bunch of people who exhibit similar apparent risk aversion, spread out over a variety of wealths and dispositions, it seems like it would be a miracle for them to all be just below the level of wealth where they’d change their minds.