1
Experienced Utility and Objective Happiness:
A Moment-Based Approach
Daniel Kahneman
Princeton University
Chapter 37 in:
D. Kahneman and A. Tversky (Eds.)
Choices, Values and Frames
New York: Cambridge University Press
and the Russell Sage Foundation
To appear: summer 2000
September 12, 1999
italics
p7 if the benefits are obtained
p 8 however --: fortunately
exultation -- exaltation
2
Experienced Utility and Objective Happiness:
A Moment-Based Approach
Daniel Kahneman
1
Princeton University
The concept of utility has carried two different meanings in its long history. As Bentham
(1789) used it, utility refers to the experiences of pleasure and pain, the “sovereign masters” that
“point out what we ought to do, as well as determine what we shall do.” In modern decision
research, however, the utility of outcomes refers to their weight in decisions: utility is inferred
from observed choices and is in turn used to explain choices. To distinguish the two notions I
refer to Bentham’s concept as experienced utility and to the modern usage as decision
utility. Experienced utility is the focus of this chapter. Contrary to the behaviorist position that
led to the abandonment of Bentham’s notion (Loewenstein, 1992), the claim made here is that
experienced utility can be usefully measured. The chapter presents arguments to support that
claim, and speculates about its implications.
This essay has three main goals: (1) to present a detailed analysis of the concept of
experienced utility and of the relation between the pleasure and pain of moments and the utility
of more extended episodes; (2) to argue that experienced utility is best measured by momentbased
methods that assess the experience of the present; (3) to develop a moment-based
conception of an aspect of human well-being that I will call “objective happiness.” The chapter
also introduces several unfamiliar concepts that will be used in some of the chapters that follow.
Pleasure and pain are attributes of a moment of experience, but the outcomes that
people value extend over time. It is therefore necessary to establish a concept of experienced
utility that applies to temporally extended outcomes. Two approaches to this task will be
compared here.
(i) The memory-based approach accepts the subject's retrospective evaluations of past
episodes and situations as valid data. The remembered utility of an episode of experience is
defined by the subject’s retrospective global assessment of it.
(ii) The moment-based approach derives the experienced utility of an episode from
real-time measures of the pleasure and pain that the subject experienced during that episode.
Moment-utility refers to the valence (good or bad) and to the intensity (mild to extreme) of
current affective or hedonic experience. The total utility of an episode is derived exclusively
from the record of moment-utilities during that episode.
The main novelty of the treatment proposed here is that it is thoroughly moment-based.
Section 2 reviews some of the evidence that raises doubts about the validity of memory-based
assessments. Section 3 presents the conditions that must be satisfied to permit an assessment of
the total experienced utility of episodes from the utilities of their constituent moments. Section 4
1
I thank Shane Frederick, Barbara Fredrickson, Laura Gibson, David Laibson, Nathan Novemsky,
David Schkade, Cass Sunstein, Richard Thaler, Anne Treisman, and Peter Wakker for helpful
comments. I also thank Peter Wakker for allowing me to use ideas and sentences that we had
fashioned together, and Peter McGraw for extremely valuable assistance and useful suggestions.
3
introduces a moment-based concept of objective happiness, and examines the feasibility of its
measurement. Section 5 exposes the ambiguity of a central idea of the well-being literature --
the hedonic treadmill -- and discusses how measures of objective happiness could contribute to
the resolution of that ambiguity. A research agenda and some major objections are discussed in
Section 6.
Insert Figure 1 about here
The main concepts of the present treatment are illustrated by Figure 1, which is drawn
from a study of immediate and retrospective reports of the pain of medical procedures
(Redelmeier and Kahneman, 1996). Patients undergoing colonoscopy were asked every 60
seconds to report the intensity of their current pain, on a scale where 10 was ‘intolerable pain’
and 0 was ‘no pain at all’. These ratings were used to construct the profiles of moment-utility
shown in the figure. The patients later provided several measures of the remembered utility of
the procedure. They evaluated the entire experience on a scale, and they also compared it to a
standard set of aversive experiences. The total utility associated with each patient’s
colonoscopy has a different nature. Unlike moment-utility and remembered utility, it is not an
expression of a subjective feeling or judgment. Total utility is an objective assessment of the
statistics of a utility profile.
The cases of patients A and B also illustrate the contrast between remembered utility
and total utility. It is immediately apparent from inspection of Figure 1 that patient B had a
worse experience than patient A,2
and this impression will be confirmed by the analysis of total
utility in section 3 (see Figure 2). However, patient A in fact retained a worse evaluation of the
procedure than patient B. In this case, as in many others, remembered utility and total utility do
not coincide, and outcomes will be ranked differently depending on whether experienced utility
is assessed by a memory-based or by a moment-based method.
2. Memory-Based Assessment: Remembered Utility
Anyone who has cared for an elderly relative whose memory is failing has learned that
there is a crucial difference between two ostensibly similar questions. The question “How are
you now?” may elicit a confident and cogent answer while the question “How have you been?”
evokes only confusion. This distinction is rarely drawn in other settings. We normally expect
people to know how they have been as well as they know how they are. Memory-based
evaluations of experience and reports of current pleasure and pain are treated with equal
respect in routine conversations -- but the respect for memory is less deserved. Studies of the
psychology of remembered utility are reviewed in detail in the next chapter. The main
conclusions of this research are listed below, and illustrated by the colonoscopy study from
which Figure 1 was drawn.
2
On the assumption that the two patients used the pain scale similarly. This issue is discussed
further in section 3.
4
Duration neglect. No one would deny that it is generally better for a colonoscopy to be short
than to be long. At least in principle, then, the duration of a colonoscopy is relevant to its
overall utility. However, memory-based assessments do not generally conform to this principle.
For example, the colonoscopies studied by Redelmeier and Kahneman (1996) varied in
duration between 4 and 69 minutes, but the correlation between the duration of a procedure
and the patient’s subsequent evaluation of it was only .03. Furthermore, the duration of the
colonoscopy had no effect on patients' hypothetical choice between a repeat colonoscopy and a
barium enema. Complete, or nearly complete neglect of duration has been found in other
studies, using a variety of different research designs. A hypothesis of 'evaluation by moments' is
introduced in chapter 38 to explain these findings: it asserts that the remembered utility of an
episode is determined by constructing a composite representative moment, and by assessing the
utility of that moment.
The Peak/End rule. The patients' subsequent evaluation of the procedure was predicted with
relatively high accuracy (r = .67) from the average of the most intense level of pain reported
during the procedure, and of the mean pain level reported over the last three minutes. Because
the Peak/End average was higher for patient A than for patient B, this empirical rule predicts --
correctly -- that patient A would retain a more aversive memory of the colonoscopy than would
patient B. Strong support for the Peak/End rule was obtained in several other studies, reviewed
in detail in the following chapter.
Violations of dominance. The Peak/End rule implies a counter-intuitive prediction: adding a
period of pain to an aversive episode will actually improve its remembered utility, if it lowers the
Peak/End average. For example, several extra minutes at pain level 4 would be expected to
improve patient A's global evaluation of the procedure. A clinical experiment with 682 patients
undergoing colonoscopy tested this prediction. Half of the patients were randomly selected for
an experimental treatment, in which the examining physician left the colonoscope in place for
about a minute after terminating the examination. The patient was not informed of the
manipulation (Katz, Redelmeier and Kahneman, 1997).3
The extra minute is distinctly
uncomfortable, but not very painful. The effect of the experimental treatment was to reduce the
Peak/End average for patients, such as patient A, who would otherwise have experienced
considerable pain in the final moments of the procedure. As predicted by the Peak/End rule,
retrospective evaluations of the procedure were significantly more favorable in the group that
experienced the prolonged procedure than in the group that was treated conventionally.
Similar violations of dominance were also observed in choices: in one experiment,
participants were exposed in immediate succession to two unpleasant sounds of similar
composition. One of them lasted for 10 seconds at 78 db; the other consisted of the same 10
seconds at 78 db, followed by 4 seconds at 66db. When given an opportunity to choose which
of the two sounds would be repeated later, most participants chose the longer (Schreiber and
Kahneman, 2000; [ch. 38]). This choice is odd, because 4 seconds of silence would clearly be
preferable to 4 seconds of 66 db noise. In this simple situation, decision utility appears to be
3
The ethical justification for the experiment was the observation of poor compliance among patients
who have had a painful colonoscopy and are instructed to schedule another.
5
determined directly by remembered utility: people choose to repeat the sound they dislike least,
and the Peak/End rule determines that.
3. Moment-Based Assessment: Total Utility
The evidence reviewed in the preceding section suggested that memory-based
assessments of experienced utility should not be taken at face value. The present section
introduces a moment-based alternative, in which the total utility of an episode is derived from
a temporal profile of moment-utility. The same analysis extends to related episodes separated in
time, because utility profiles may be concatenated. For example, the total utility of a Kenya
safari should include subsequent occasions of slide-showing and reminiscing.
Figure 2a presents the data of Figure 1 in the form of a decumulative function, which
shows the amount of time spent at or above each pain level. If the measure of moment-utility on
which it is based satisfies a stringent set of conditions, total utility can be derived from the type
of representation illustrated in Figure 2 (Kahneman, Wakker and Sarin, 1997). Six conditions
are listed below. The first four impose requirements on the measure of moment-utility. The last
two conditions are normative in character; they specify how total utility is constructed from
moment-utilities.
Figure 2 about here
Inclusiveness. In a moment-based approach the utility profile is a 'sufficient statistic'
to determine the experienced utility of an extended outcome. The measure of moment-utility
should therefore incorporate all the aspects of experience that are relevant to this evaluation. In
particular, a measure of moment-utility should reflect the affective consequences of prior events
(e.g., satiation, adaptation, fatigue), as well as the affect associated with the anticipation of future
events (fear, hope).
Ordinal measurement across situations. The measurement of moment-utility must
be ordinal or better. Experiences of different types (e.g., a stubbed toe and a humiliating
rebuke) must be measured on a common scale.
Distinctive neutral point. The pain scale that was used in the colonoscopy study has
a natural zero point. However, the dimension of moment-utility is bipolar, ranging from intensely
positive to neutral, and from neutral to intensely negative affect. A distinctive neutral point
("neither pleasant nor unpleasant", "neither approach nor avoid") anchors the scale and permits
comparisons across situations and persons.4
As will be seen later, a stable zero is also essential
for cardinal measurement of moment-utility on a ratio scale.
4
Some authors consider valence as bi-valent rather than bipolar (e.g., Cacioppo, Gardner, and
Berntson, 1999).
6
Interpersonal comparability. The scale must permit comparisons of individuals and
groups. The next section shows that this requirement may be more tractable than is commonly
thought.
The next two requirement are of a different nature. They involve normative assumptions
about the nature of total utility. The assumptions of separability and time-neutrality are required
to justify the transformation of utility profiles (e.g., Figure 1) into the decumulative format (e.g.,
Figure 2). The discussion of these assumptions highlights a critical difference between the
present analysis and economic models of the utility of sequences of outcomes. These models
generally describe outcomes as physical events (see, e.g., chapters 32-33). The analysis of
total utility, in contrast, describes outcomes as moment-utilities.
Separability: the order in which moment-utilities are experienced does not affect
total utility. Order effects are ubiquitous in experienced utility. For example, a strenuous
tennis game and a large lunch yield a better experience in one order than in the other, because
the enjoyment of the tennis game is sharply reduced when it follows lunch. The condition of
separability states that the contribution of an element to the global utility of the sequence is
independent of the elements that preceded and followed it. This condition is often violated
when the sequences are described in terms of physical events, such as lunch and a tennis game.
In a moment-based treatment, however, the elements of the sequence that is to be evaluated are
not events -- they are moment-utilities associated with events. Because all the effects of the
order of events are already incorporated into moment-utilities, separability can be assumed for
these moment-utilities. Separability is necessary for the decumulative representation, which does
not preserve order information. To appreciate the intuition, consider an individual who receives
two unexpected prizes in immediate succession, one of $500, the other of $10,000, then
promptly dies, or loses his memory. In evaluating the total utility of these experiences, we
recognize that it would be better for the two prizes to arrive in ascending rather than in
descending order – presumably because the enjoyment of the smaller prize is greater when it
comes first. Now imagine that all you know is that just before he died (or became amnesic) an
individual had two pleasurable experiences with utilities Ua and Ub, where Ua>> Ub, Would we
still think that their order matters? When outcomes are moment-utilities, there is no compelling
reason to reject separability.
Time neutrality: all moments are weighted alike in total utility. Total utility is a
measure on completed outcomes, and is therefore always assessed after the fact. Unlike
decision making, in which the temporal distance between the moment of decision and the
outcome may matter, the temporal distance between an outcome and its retrospective
assessment is entirely irrelevant to its evaluation. Total utility is therefore time neutral. In this
important respect, it is unlike decision utility and remembered utility, which both assign more
weight to some parts of the sequence than to others. The decision utility of outcomes that occur
late in a sequence is often heavily discounted. In remembered utility, on the other hand, the last
parts of a sequence are weighted more than those that came earlier -- a bias that is incorporated
in the Peak/End rule. The normative status of both weighting schemes is dubious. If the benefits
are obtained before the costs must be paid, discounting of delayed outcomes in decisions favors
myopic preferences for options that do not maximize total utility. The overweighting of endings
7
may be equally unreasonable: an experience that ended very badly could still have positive utility
overall, if it was sufficiently good for a sufficiently long time (Kahneman, Wakker and Sarin,
1997).
Measures of total utility
The representation of Figure 2 assumes both that a utility profile can be rearranged at
will and that all its parts are weighted equally. Separability and time neutrality are therefore
necessary, and together with the assumptions of inclusiveness and ordinal measurement,
sufficient for the representation of utility profiles as decumulative temporal distributions. The
total utility of episodes is a measure on these distributions.
Figure 2 illustrates two representations of temporal distributions of utility, which differ in
their ordinates: time is shown in absolute units in panel (a), but in proportional units in panel (b).
The representation of panel 2a is appropriate when the duration of the episode is relevant to its
evaluation. Thus, it is reasonable to say that the colonoscopy of patient B was worse than that
of patient A because it lasted longer. On the other hand, it does not make sense to say that
Helen was happier last week than she was last Sunday because last week was longer than last
Sunday. The representation of Figure 2b is correct when the duration of the period of evaluation
is not relevant to its evaluation. It is the appropriate representation in the assessment of the
well-being of individuals and groups, which is discussed in the next section.5
As Figure 2a illustrates, the ordinal measurement of moment-utility permits the detection
of distributional dominance. By this simple test, patient B had a worse colonoscopy than patient
A. The decumulative distribution can also be characterized by non-parametric statistics, such as
the median and other fractiles. However, distributional dominance is a blunt measuring
instrument, and no single non-parametric index captures all the relevant information contained in
a temporal distribution of moment-utilities. Figure 2b presents decumulative distributions of
moment-utility for two individuals, George and Helen. There is no dominance in this
comparison, and the medians are close. The main conclusion that can be drawn is that George
experienced more extremes of affect than Helen did.
Cardinal measurement of moment-utility would be desirable, of course. With cardinal
measurement, the most natural index of total utility could be calculated: the temporal integral of
moment-utility. The idea has a long history (Edgeworth discussed it in 1881) but it effectively
requires a rescaling of moment-utility in terms of physical time, which is difficult to implement.
This reasoning is explicit in the use of QALYs (Quality Adjusted Life Years) in medical decision
making. QALY's are derived from judgments of equivalence between periods of survival that
vary in duration and in level of health. For example, two years of survival at a QALY of 0.5 are
equally desirable as one year in normal health (Broome, 1993).
5
There are situations in which both representations are relevant. The total utility (or
happiness) that Alan enjoyed while he was married to Helen may depend on how long they were
married before she died in an accident. On the other hand, an assessment of how happy Alan was
in his marriage should not be influenced by how long it lasted.
8
A formal analysis of the temporal integration rule was offered by Kahneman, Wakker
and Sarin (1997). Their treatment invoked all the assumptions that were discussed in this
section, including separability and temporal neutrality. In addition, it introduced an idealized
objective observer, who assesses the total utility of utility profiles, such as those of Figure 1. The
following axioms specify the logic of this assessment.
1. The global utility of a utility profile is not affected by concatenation with a neutral
utility profile.
2. Increases of moment-utility do not decrease the global utility of a utility profile.
3. In a concatenation of two utility profiles, replacing one profile by another with a
higher global utility will increase the global utility of the concatenation.
The following theorem can be proved: "The three axioms above hold if and only if there exists a
non-decreasing ("value") transformation function of moment-utility, assigning value 0 to 0, such
that global utility orders utility profiles according to the integral of the value of moment-utility
over time." The proof is due to Peter Wakker.
The representation of total utility as a temporal integral implies a scale of moment-utility,
monotonically related to the original scale, but now calibrated by its relation to duration. For
example, suppose that an idealized observer who conforms to the axioms judges that 1 minute
of pain that had been rated 7 on the original scale is equivalent to 2 minutes at a rating of 6. On
the transformed scale, the value that corresponds to the original rating of 7 will be double the
value assigned to a rating of 6. Idealized observers are hard to find, of course, and cardinal
scaling of utility is therefore a conceptual exercise rather than a practical procedure. Fortunately,
the decumulative representation is adequate for many purposes. The conditions identified by
Kahneman, Wakker and Sarin (1997) are sufficient to guarantee this representation, without
attempting cardinal measurement and without involving observers.
4. Objective Happiness: Concept and Measure
Moment-utility is the building block of the broader construct of experienced utility. It is
also the building block for a construct of objective happiness, with which the remainder of this
chapter is concerned. Like total utility, objective happiness is to be derived from a distribution
of moment-utility (see Figure 2b for an example) that characterizes an individual (George or
Helen), a group (Californians, midwesterners, paraplegics), or a setting (the Washington
subway, the New York subway). Like total utility, objective happiness is a moment-based
concept, which is operationalized exclusively by measures of the affective state of individuals at
particular moments in time. In this essential respect, objective happiness differs from standard
measures of subjective well-being, which are memory-based and require the subject to report a
global evaluation of the recent past. The term ‘objective’ is used because the judgment of
happiness is made according to objective rules. The ultimate data for the judgment are, of
course, subjective experiences.
In the special conditions of the clinic or laboratory it is sometimes possible to obtain
continuous or almost continuous reports of experienced utility from patients or experimental
subjects. Continuous measures are of course impractical for the measurement of objective
9
happiness over a period of time. Sampling techniques must be used to obtain a set of values of
moment-utility that adequately represents the intended population of individuals, times and
occasions. For example, a study of the objective happiness of Californians should use a sample
of observations that reflects the relative amounts of time spent on the freeway and in hot tubs.
Techniques for sampling times and occasions have been developed in the context of Experience
Sampling Methodology (ESM) (Csikszentmihalyi, 1990; Stone, Shiffman and DeVries, 1999).6
Reporting the sign and intensity of current hedonic and affective experience is not
essentially different from the standard psychophysical tasks of reporting color or smell. The
report of affect is probably intermediate in difficulty between these tasks: somewhat more
difficult than labeling colors, but much easier than describing smells. The worlds of affective
experience and of color experience are similar in another important respect: they combine
phenomenological richness with a simple underlying structure. A non-intuitive finding of color
research is that, in spite of the enormous variety of subjective color experience, the world of
color can be represented in a two-dimensional space -- the color circle -- with additional
information provided in a third dimension of luminance. A major result of research on affect is
that a similarly simple structure is found in that domain as well. Much of the variation among
affective states is captured by specifying their positions in a two-dimensional space, which is
defined by the major dimensions of valence (good to neutral to bad) and arousal (from frenetic
to lethargic) (Plutchik and Conte, 1997; Russell, 1980; Russell and Carroll, 1999; Stone, 1995;
Warr, 1999). As Figure 3 illustrates, the two-dimensional structure permits a distinction
between two forms of positive affect—exuberant joy or serene bliss—and two forms of
negative affect—agitated distress or apathetic depression.
Insert Figure 3 about here
A significant limitation of the two-dimensional representation of affect is that it does not
capture the nature of primary emotions, such as surprise or anger. Another objection to this
scheme questions the assumption that valence is a single bipolar dimension. Cacioppo, Gardner,
and Berntson (1999) point out that positive and negative affect are processed by different neural
systems and may be activated concurrently. They suggest that a three-dimensional
representation may be necessary, in which 'good' and 'bad' are independent dimensions.
However, the systems are not functionally independent, and there is evidence that they inhibit
each other. Lang (1995) has shown, for example, that watching pleasant pictures of food or
smiling babies attenuates the startle response to a loud sound, whereas startle is actually
enhanced in the presence of disgusting or otherwise awful pictures. For the present purposes,
the description of valence as a bipolar dimension can be retained as a useful approximation,
even if it is not perfectly correct (Russell and Carroll, 1999; Tellegen, Watson and Clark,
1999). Later in this section I discuss a physiological measure that can provide convergent
validation of the measurement of valence.
6
Participants in studies using ESM carry a palmtop computer that beeps at random times during
the day. The palmtop computer then displays questions that elicit elicit information about the
current setting and about the subject’s present affective state.
10
The simplest method for eliciting a self-report of current affective state is undoubtedly
the affect grid: respondents describe their state by marking a single position on a grid defined
by the two dimensions of valence and arousal (Russell, Wess and Mendelsohn, 1989). The
affect grid appears to be applicable in all situations: any moment of life can be characterized by
the attributes of valence and arousal. The characterization is incomplete, of course, but hardly
irrelevant to an analysis of well-being. The affect grid can be used to derive a unidimensional
distribution of affective values, as in Figure 2. Of course, finer-grain analyses that do not
collapse over the arousal dimension are likely to be even more informative.
Next, I attempt to evaluate the affect grid in terms of the four criteria of adequate
measurement of moment-utility that were considered in the preceding section. The purpose of
this speculative discussion is to illustrate both the problems and the promise of measurement in
this domain, not to endorse any particular measure.
Inclusiveness. Defining happiness by the temporal distribution of experienced affect
appears very narrow, and so it is. The concept of objective happiness is not intended to stand
on its own, and is proposed only as a necessary element of a theory of human well-being. A
comprehensive account of well-being inevitably brings in philosophical considerations (Ryff and
Singer, 1998) and a moral conception of “the good life” (Brock, 1993; Nussbaum and Sen,
1993), which are not easily reduced to experienced utility. However, good mood and
enjoyment of life are not incompatible with other psychological criteria of well-being that have
been proposed, such as the maintenance of personal goals, social involvement, intense
absorption in activities, and a sense that life is meaningful (Argyle, 1999; Cantor and Sanderson,
1999; Csikszentmihalyi, 1990; Fredrickson, 1999). Clearly, a life that is meaningful, satisfying
and cheerful should rank higher on the scale of well-being than a life that is equally meaningful
and satisfying, but sad or tense. Objective happiness is only one constituent of the quality of
human life, but it is a significant one.
Ordinal measurement across situations. The experiences of a stubbed toe and of a
humiliating rebuke are both likely to be described on the affect grid as negative in valence and
high in arousal -- but can the valence and the arousal be compared? It is a familiar psychological
fact that comparison along a single attribute is especially difficult if the objects compared differ in
other attributes as well. For example, it is more difficult -- but not impossible -- to compare the
loudness of sounds that differ in pitch and timbre than to compare sounds that share these
attributes. The question of whether people can compare physical and emotional pain, or the
thrills of food and of music is ultimately empirical. In general, the coherence of judgments
across categories is tested by examining the correspondence between ranking of objects in
explicit comparisons and ratings of the same objects, considered one at a time (see chapter 36).
This test is applicable to ratings and rankings of the utility of different kinds of experience,
although it is complicated by the necessity of relying on memory for the comparison task.
Absolute zero point. Bipolar scales of judgment comprise scales for two qualitatively
different attributes, separated by a distinctive neutral point. Familiar examples include the
dimensions that run from hot to cold and from red to green. The neutral point that separates the
reddish zone from the greenish zone of the red-green dimension is 'colorless gray or white'.
11
Similarly, 'neither cold nor warm' is the natural zero of the scale of subjective temperature. The
stimulus that gives rise to a neutral experience may be different in different contexts, but the
neutral experience itself is constant. For example, people can completely adapt to a range of
different temperatures, and within that range any temperature to which one has fully adapted will
evoke the same neutral experience. The natural zero of the scale of moment-utility should be
'neither pleasant nor unpleasant—neither approach nor avoid.' A distinctive zero permits a
crude but useful assessment of well-being in terms of the amount of time spent on the positive
and on the negative side of the neutral point (Diener, Sandvik and Pavot, 1991; Parducci,
1995). Because it is distinctive, the neutral value can be used with some confidence to match
experiences -- whether thermal or hedonic -- across time for a given individual, and even across
individuals (Kahneman and Varey, 1991).
Interpersonal comparability. Interpersonal comparisons of subjective experience
can never be fully satisfactory, but the success of psychophysical research suggests that these
comparisons do not present an intractable problem. Three illustrative lines of evidence will be
mentioned in support of this conclusion. (i) There is substantial inter-subject agreement on the
psychophysical functions that relate reports of the intensity of subjective experience to the
physical intensity of the stimulus. For example, the relation between a measure of the physical
strength of labor contractions during childbirth and self-reports of pain was generally similar for
different women (Algom and Lubel, 1994). (ii) The design of the colonoscopy study
(Redelmeier and Kahneman, 1996) included a group of 50 patients who were not required to
report their pain every minute during the procedure. Assessments of the pain of these patients
were made every 60 seconds by a minimally trained assistant, on the basis of what she could
see and hear of the patient's reactions. The remarkable result was that the Peak/End average of
the observer's ratings correlated quite highly (r = .70) with the patients' own global evaluations
of the procedure, reported after its termination. The observer was evidently capable of
meaningful comparisons of the immediate experiences of different patients. Furthermore, the
pattern of results implies considerable agreement among patients in the use of the response
scales. (iii) The observation of high correlations between self-reports and physiological
measures, which is discussed next, provides further support of the feasibility of interpersonal
comparisons.
Physiological validation
The fundamental simplicity of affective space and the speed of developments in brain
research make it likely that physiological correlates of moment-utility (affective valence) will be
found. The difference between levels of electrical activity in the left and right hemispheres of the
prefrontal cortex appears to meet most criteria for such a measure (Davidson, 1998). Positive
and negative affect are respectively associated with greater activity in the left and in the right
prefrontal regions. Neurologists have long known that the misery of a stroke that affects the
prefrontal area is much worse if the damage is in the left hemisphere -- the happier region,
where opportunities for approach appear to be calculated (Sutton and Davidson, 1998). A
simple measure of the difference in the levels of activity in the two hemispheres has been
validated as a measure of mood and of the response to affectively relevant stimuli. Stable
individual differences in the characteristic value of this difference are highly correlated with
differences in individual temperament and personality, both in adults (Davidson & Tomarken,
12
1989; Sutton and Davidson, 1998) and in babies (Davidson & Fox, 1989). Correlations with
questionnaire measures of approach and avoidance tendencies, and of positive and negative
affect are strikingly high (Sutton and Davidson, 1997; Tomarken et al, 1992). This result
demonstrates, in passing, that the function that relates self-reports to brain states must be quite
similar across people.
A different approach to the physiology of well-being has been adopted by investigators
who study physiological markers of long-term cumulative load on coping resources (Ryff and
Singer, 1998; Sapolsky, 1999). It is tempting to speculate that these measures of stress-induced
physiological wear and tear could be correlates of long-term objective happiness. It is not
science fiction to imagine that physiological measures will eventually contribute to the solution of
enduring puzzles in the study of experienced utility and of well-being, and provide a criterion for
the validation of self-report measures.
In conclusion, the prospects are reasonably good for an index of the valence and
intensity of current experience, which will be sensitive to the many kinds of pleasure and anguish
in people's lives: moods of contentment or misery, feelings of pride or regret, aesthetic thrills,
experiences of 'flow', worrying thoughts and physical pleasures. However, the limits of what is
claimed here should be made explicit. No one will wish to argue that the affect grid or a
measure of prefrontal electrocortical asymmetry convey all that we would wish to know about
an individual's affective and hedonic experience, just as no one would argue that a measure of
the pooled activity levels in the red-green and blue-yellow channels convey the experience of
seeing a view. The claim made here is not that the dimension of valence in experience is all we
need to know -- only that we need to know the valence of experience.
5. The ambiguity of treadmill effects
The fundamental surprise of well-being research is the robust finding that life
circumstances make only a small contribution to the variance of happiness—far smaller than the
contribution of inherited temperament or personality (Diener et al, 1999; Lykken and Tellegen,
1996; Myers and Diener, 1995). Although people have intense emotional reactions to major
changes in the circumstances of their lives, these reactions appear to subside more or less
completely, and often quite quickly (Headey and Wearing, 1992; Frederick and Loewenstein,
1999). As a consequence, cross-sectional correlations between life circumstances and
subjective happiness are low. Between 1958 and 1987, for example, real income in Japan
increased fivefold, but self-reported happiness did not increase at all (Easterlin, 1995). The
most famous observations in this vein were made by Brickman, Coates, and Janoff-Bulman
(1978), who reported that after a period of adjustment lottery winners are not much happier
than a control group and paraplegics not much unhappier. In a now classic essay, Brickman and
Campbell 1971 used the term hedonic treadmill both to describe and to interpret such
observations. I will use the term treadmill effect to refer to the general observation, while
reserving the term hedonic treadmill to refer to a particular explanation of the effect.
Treadmill effects
13
Brickman and Campbell (1971) based their conception of the hedonic treadmill on a
notion of adaptation level, which Helson (1964) had introduced earlier to explain phenomena of
adaptation in perception and judgment. Anyone who has bathed in a cool pool, or in a warm
sea, will recognize the basic phenomenon. As one adapts, the experience of the temperature of
the water gradually drifts toward 'neither hot nor cold', and the experience of other temperatures
changes accordingly. A temperature that would be called warm in one context may feel cool in
another. Brickman and Campbell proposed that a similar process of adaptation applies to the
hedonic value of life circumstances.
The prevalence of treadmill effects is of psychological interest for two separate reasons.
First, because of the ironic light it sheds on the pursuit of happiness. Second, because its
suprise value is itself surprising: if the treadmill effect is a common fact of life, why do people not
seem to know about it? As the next chapter shows, the extent and the speed of treadmill effects
in self-reported happiness are not anticipated. A study conducted among students in California
and in the Midwest was designed to examine both the reality of regional effects in life
satisfaction and beliefs about these effects (Schkade and Kahneman, 1998). The results
showed no trace of a difference between Californians and Midwesterners in overall life
satisfaction. However, they revealed a widespread expectation, shared by residents of both
regions, that the self-reports of Californians would indicate more happiness than the self-reports
of Midwesterners.
Beside their robustness and their unexpectedness, studies of treadmill effects share a
third characteristic: they are not entirely persuasive. Skeptics argue that the null results are due,
at least in part, to differences in the use of scales of happiness and life satisfaction. If people
whose life circumstances differ use the scales differently, there may be less hedonic adaptation
to circumstances than surveys of subjective well-being suggest. Frederick and Loewenstein
(1999) present an extensive list of reasons that may lead paraplegics to overstate their “true
happiness”. The main claim of the present section is that these doubts are not mere quibbles,
and that demonstrations of treadmill effects are subject to a critical ambiguity, which can only be
resolved by measuring objective happiness.
What do people mean when they assert that Californians are, in fact, happier than other
people, although Californians do not report themselves as happier? The possibility that
Californians have more meaningful lives than others is rarely advanced. Rather, the proposition
that Californians are happier appears to mean that Californians are objectively happier: their
lives are richer in pleasures and less burdened by hassles, and they are consequently in a better
mood, on average, than most other people. In this view, a treadmill effect is observed because
Californians use the happiness scale differently than other people. The same argument could of
course be extended to the Japanese who reported equal happiness in 1987 and in 1958 despite
a large increase in standard of living. It could also apply to paraplegics. If this view is
accepted, the evidence for a happiness treadmill unravels. Perhaps life circumstances do, after
all, have a greater effect on well-being than surveys of subjective happiness indicate. A specific
hypothesis about a mechanism that could produce spurious evidence for a hedonic treadmill is
introduced next.
14
The satisfaction treadmill
Brickman and Campbell explained treadmill effects by invoking the notion of an
adaptation level (Helson, 1964). I propose an alternative hypothesis, called a satisfaction
treadmill, which draws on another venerable psychological concept: the aspiration level (Irwin,
1944). The aspiration level is a value on a scale of achievement or attainment that lies
somewhere between realistic expectation and reasonable hope. The essential observation is
that people are always satisfied when they attain their aspiration level, and usually quite satisfied
with slightly less. The best-established finding about aspiration levels is that they are closely
correlated with past attainments. Current income, for example, is the single most important
determinant of the income that is considered satisfactory for one’s household (Van Praag and
Frijters, 1999).
To illustrate the difference between a hedonic treadmill and a satisfaction treadmill,
consider a former graduate student, who will be called Helen. Assume that Helen regularly eats
in restaurants, and that she has a well-defined ranking of experienced utility for a set of entrées,
which is perfectly correlated with their price. In her graduate-student days Helen was
constrained by her budget to consume mostly mediocre dishes. Now she has taken a lucrative
job which allows her to consume food of higher quality. In tracking her overall satisfaction with
food over the transition period, we observe that her satisfaction rises initially, then settles back
to its original level. This is the standard pattern of a treadmill effect. Now consider two
mechanisms that could produce this effect.
(i) The hedonic treadmill hypothesis invokes the hypothesis of an adaptation level for
palatability, which is determined by a weighted average of the palatability experienced on recent
occasions. Helen’s pleasure from food rises initially, because the food she consumes exceeds
the adaptation level that was established in her graduate student days. As time passes,
however, her adaptation level will catch up to her consumption, and her pleasure from food will
return to its original level. After she has adapted to the new level of pleasure, she will consume
better entrées than she did as a graduate student, but will enjoy each of them less than she had
in the past. On the hypothesis of a hedonic treadmill, Helen’s reports of subjective satisfaction
correctly reflect the changes in her enjoyment of food.
(ii) The hypothesis of a satisfaction treadmill invokes the notion of a changing aspiration
level, which is determined in large part by the level of pleasure recently derived from food. For
the sake of an extreme example, assume now that there is no hedonic adaptation at all, and that
the experienced utility that Helen derives from any entrée does not change. As the quality of her
entrées improves, so does the overall pleasure that she derives from them. Suppose, however,
that Helen has an aspiration level for food pleasure: as the pleasure that she obtains from food
increases, her aspiration level gradually follows, eventually adjusting to her higher level of
enjoyment. After this adjustment of aspirations, Helen reports no more satisfaction with food
than she did when she was poorer, although she actually draws more pleasure from food now
than she had done earlier.
The concept of a satisfaction treadmill extends readily from food pleasure to happiness.
Only one additional assumption is needed: that people require a certain balance of pleasures and
15
pains to report themselves happy or satisfied with their lives. On this hypothesis, Californians
could indeed enjoy life more than others. However, if they also require more enjoyment than
others to declare themselves happy, they will not report higher subjective happiness.
Californians might be happier than other people objectively, but not subjectively.
The statistical test for the hypothesis of a satisfaction treadmill is straightforward: if such
a treadmill exists, the regression lines that describe the relation between subjective and objective
happiness will not be the same for groups in different circumstances. At any level of objective
happiness, people with a higher aspiration level will report themselves less happy and less
satisfied than others whose aspirations are lower. If the results for both groups fall on the same
regression line, there is no satisfaction treadmill.
A satisfaction treadmill and a hedonic treadmill may co-occur, both contributing to
observed treadmill effects. The critical conclusion of the analysis is that the relative contributions
of the two mechanisms cannot be determined without direct measurements of experienced
utility. The hypothesis of a satisfaction treadmill is both plausible and effectively untested, and
the interpretation of treadmill effects observed with measures of satisfaction and subjective
happiness is correspondingly indeterminate. A substantial amount of well-being research might
have to be redone to resolve this ambiguity.
6. Discussion
The premise of this essay was a distinction between two meanings of the term 'utility',
which were labeled experienced utility and decision utility. Decision utility is about wanting,
experienced utility is about enjoyment. This basic dichotomy has been discussed elsewhere
(Kahneman 1994 [ch.42]; Kahneman, 1999). The focus of the present discussion was the
further distinction between two approaches to the interpretation and measurement of
experienced utility, which were called moment-based and memory-based.
Wanting or not wanting is not the only orientation to future outcomes. People
sometimes also attempt to forecast the affective or hedonic experience -- the experienced utility
-- that is associated with various life circumstances. These are judgments of predicted utility
(Kahneman, Wakker and Sarin, 1997), or affective forecasting (Gilbert et al, 1998). With the
inclusion of predicted utility, the number of distinct concepts of the utility of extended outcomes
-- bounded episodes or states of indefinite duration -- rises to four. The concepts are
distinguished by the operations on which they are based:
(i) Decision utility is inferred from observed preferences.
(ii) Predicted utility is a belief about future experienced utility.
(iii) Total utility is a moment-based measure of experienced utility. It is derived from
measurements of moment-utility, statistically aggregated by an objective rule.
(iv) Remembered utility is a memory-based measure of experienced utility, which is
based on retrospective assessments of episodes or periods of life.
Decision utility is the almost exclusive topic of study in decision research and
economics, and memory-based self-reports are the almost exclusive topic of study in the
16
domain of Subjective Well-Being (SWB) research. The various concepts of utility suggest a rich
and complex agenda of research; they also suggest different interpretations of utility
maximization.
To extend an example already discussed, consider families that move (or might move)
fromCalifornia to Ohio. The decision utility of families that consider relocation could be studied
by eliciting their global preferences, as well their preferences for different attributes of the two
locations. Whether or not people maximize utility is interpreted in this context as a question
about the coherence of preferences: would the choice that the family makes survive reframing,
or a new context? The predicted utility which the decision makers associate with the
alternative locations could be studied by eliciting their general beliefs about the experience of
living in the two places, and their particular beliefs about what they might enjoy or dislike. There
is considerable evidence that this task of affective forecasting is not one in which people excel
(see, Gilbert et al, 1998; Kahneman,1999, [ch. 38]; Kahneman and Schkade, 1999;
Loewenstein and Adler, 1995 [ch. 40]; Loewenstein and Schkade, 1999; Schkade and
Kahneman, 1998) . Another question of some importance is whether people even consider the
uncertainty of their future tastes as part of the activity of decision making (March, 1978;
Simonson, 1990 [ch. 41]).
As we have seen in preceding sections, different conclusions about the outcomes of
families that did move to California could be reached, depending on whether the outcomes are
assessed by moment-based or by memory-based techniques -- by measures of total utility or
objective happiness on the one hand, of remembered utility or subjective happiness on the
other. Self-selection and dissonance reduction would predict high subjective happiness among
people who moved voluntarily. Treadmill effects, on the other hand, predict that people who
moved will eventually return to their characteristic level of subjective happiness. The argument
of the preceding section was that these memory-based measures do not tell us what we would
really want to know: whether people who move to California are really happier there than they
were earlier. In the approach adopted here, this question must be answered by obtaining
moment-based measures, using either self-reports or physiological techniques.
The distinctions that have been drawn between variant concepts of utility are directly
relevant to normative issues in the domain of policy, as the following list of questions illustrates.
“Does the presence of trees in a city street affect the mood of pedestrians?” “What is the
contribution of an attractive subway system to the well-being of city residents?” “What are the
well-being consequences of inflation, unemployment, or unreliable health insurance?” Here
again, it is possible to ask what the public wants, perhaps by asking people how much they are
willing to pay for the provision of some goods. It is also possible to elicit people's opinions
about the welfare effects of particular public goods, to obtain a measure of predicted utility.
Finally, it is sometimes possible to measure the experienced utility associated with public goods.
Again, this can be done either by moment-based or by memory-based methods.
Conventional economic analyses of policy recognize only one measure of
the value of public goods: the aggregate willingness of the public to pay
for them. There are serious doubts about the coherence of this concept
17
and the feasibility of measuring willingness to pay (see, e.g., Kahneman, Ritov and Schkade,
1999 [ch.36]). A more fundamental question is whether willingness to pay should remain the
only measure of value. The present analysis suggests that moment-based measures of the actual
experience of consequences should be included in
assessments of outcomes and as one of the criteria for the quality of decisions, both public and
private.
Treadmill effects raise difficult normative questions. If there is a hedonic treadmill, then
changes in circumstances will often have less long-term effects on human welfare than might be
inferred from their ex ante desirability or from the initial hedonic response that they evoke.
Should policy resist calls for the provision of desirable goods that convey no long-term utility
benefits? And if there is a satisfaction treadmill, then clients of policies will never be satisfied
very long even when an improvement in their circumstances makes them permanently
(objectively) happier. Furthermore, false negatives occur in all prediction tasks: people may fail
to identify some circumstances that would actually make them happier. Do policy makers have a
duty to provide goods that make people truly better off, even if they are neither desired ex ante
nor appreciated ex post? The easy answer is no, but it is perhaps too easy. Dilemmas of
paternalism are raised again in chapter 42.
The moment-based approach to experienced utility and happiness which has been
presented here runs into two strong objections. The first is that there is more to human wellbeing
than good mood. The second is that the moment-based view is based on abstract
arguments and on logical construction, and fails to reflect the role of memory in the subjective
reality of mental life. Both objections have much merit, but neither should block the judicious use
of moment-based measures.
Objective happiness is not proposed as a comprehensive concept of human well-being,
only as a significant constituent of it. Maximizing the time spent on the right side of the affect
grid is not the most significant value in life, and adopting this criterion as a guide to life may be
morally wrong, and perhaps also self-defeating. However, the proposition that the right side of
the grid is a more desirable place to be is not particularly controversial. Indeed, there may be
more differences among cultures and systems of thought about the optimal position on the
arousal dimension -- some prefer the bliss of serenity, others favor the exultation of faith or the
joys of participation. Objective happiness is a common denominator for various conceptions of
well-being. Furthermore, when it comes to comparisons of groups, such as Californians and
others, or to assessments of the value of public goods such as health insurance or tree-lined
streets, experienced utility and objective happiness may be the correct measure of welfare.
In a memory-centered view of life, the accumulation of memories is an end in itself. A
clear statement of this position is offered by Tversky and Griffin (1991 [ch. 39]), who speak of
the stock of memories as an endowment, which is enriched by storing new memories of good
experiences. The moment-centered approach that has been proposed here does not deny the
importance of memory in life, but it suggests a metaphor of consumption rather than of wealth.
Without a doubt, the traveler who goes to a Kenya safari may continue to derive utility from that
episode long after it ends, whether directly—by “consuming” the memories in pleasant or
18
unpleasant reminiscing—or, perhaps more importantly, by consuming the experience of the self
as it has been altered by the event (Elster and Loewenstein, 1992). However, the momentbased
approach raises a question that should not be dismissed too lightly: how much time will be
spent in such consumption of memories, relative to the duration of the original experience? The
weight of memory relative to actual experience is likely to be reduced when time is taken
seriously.
The memory-based and the moment-based views draw on different intuitions about
what counts as real. There is an obvious sense in which present experience is real and memories
are not. But memories have an attribute of permanence which lends them a weightiness that the
fleeting present lacks: they endure and populate the mind. In the words of the novelist Penelope
Lively (1993, p.15), “A narrative is a sequence of present moments but the present does not
exist.” Because memories and stories of the past are all we ultimately get to keep, memories
and stories often appear to be all that matters. These common intutitions are part of the appeal
of Fredrickson's (1999) eloquent critique of the idea -- central to the notion of total utility and
objective happiness -- that all moments of time are weighted equally. The argument for meaning
is memory-based: memory certainly does not treat all moments equally, and meaningful
moments must be memorable. Indeed, the statement "I will always remember this" is often
proffered, not always correctly, at meaningful moments. Futhermore, the immense importance
that most of us attach to deathbed reconciliations suggests that who does the remembering may
not greatly matter in conferring meaning, so long as someone does.
The goal of this discussion is not to reject the memory-based view, which is indeed
irresistibly appealing, but to point out that intuition is strongly biased against a moment-based
view. The approach proposed here is bound to be counter-intuitive even if it has merit -- that
was one of the reasons for proposing it. Although wholly devoid of permanence, the
experiencing subject deserves a voice.
19
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24
Figure 1: Pain intensity reported by two colonoscopy patients
Patient B
0
2
4
6
8
10
0 10 20
Time (minutes)
Patient A
0
2
4
6
8
10
0 10 20
25
Figure 2a: Decumulative temporal function representing pain profiles of Patients A & B
Figure 2b: Fictitious decumulative functions representing the objective happiness of two
individuals over a period of time
0
5
10
15
20
25
0 2 4 6 8 10
Pain Intensity
Patient A
Patient B
0
20
40
60
80
100
-10 -5 0 5 10
Moment Utility
Helen
George
26
Figure 3: A representation of affective space
Joyful
Enthusiasm
Pleasure
Serene
Pleasure
Distress
Arousal(+)(-)
(+)Pleasure(-)
Agitated
Distress
Apathetic
Depression