[carbocation]

In summary, what is often described as "loss aversion" is actually just an expected property of diminishing marginal utility, and does not require a new term to explain it.

Loss aversion, instead, is state dependence that makes you feel worse about state X if you came from state X+1, and better about it if you came from state X-1 (assuming X is, say, wealth).

It seems to me that "loss aversion" might be reconstituted as "utility hysteresis" to avoid the ambiguity.

[lbhnact]

I like the phrase 'utility hysteresis'.

I would say that, at least academically, the difference between 'diminishing marginal utility' and 'loss aversion' is appreciated. To quote course material, 'When directly compared against each other, losses loom larger than gains'.

The difference in perception on the gain and loss side has been tested some, and the curve is supposed to look like this: https://goo.gl/PS8Z7c

[Hermel]

"Loss aversion" should simply be seen as an observable behavior regardless of its cause. It makes no sense to say behavior stemming from diminishing marginal utility is not loss aversion if it leads to the same symptoms as "true" loss aversion.

[marklgr]

Why not just keep calling it (the popular definition) "loss aversion", and name the other concept with the more precise "reference dependence"?