For years, economists have been unhappy with the conventional textbook theory of risk aversion. This says that we have diminishing marginal utility of wealth: each extra pound brings us less satisfaction than the previous one. Because of this, we discount potential winnings and so refuse to take some bets even if they have positive expected pay-offs.
Sadly, however, as Matthew Rabin and Richard Thaler pointed out back in 2001, this theory is "not plausible". They show that it implies that a man who'd reject a 50-50 chance of losing £10 or winning £11 would also reject a 50-50 chance of losing £100 or winning an infinite amount of money: this is because if we discount one extra pound, we'll discount subsequent ones even more. But this is daft.