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Evolutionary efficiency and happiness
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DOI：10.1086/516737.png)
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We model happiness as a measurement tool used to rank alternative actions. Evolution favors a happiness function that measures the individual's success in relative terms. The optimal function is based on a time- varying reference point-or performance benchmark-that is updated over time in a statistically optimal way in order to match the individual's potential. Habits and peer comparisons arise as special cases of such an updating process. This updating also results in a volatile level of happiness that continuously reverts to its long-term mean. Throughout, we draw a parallel with a problem of optimal incentives, which allows us to apply statistical insights from agency theory to the study of happiness.
Keyword:
CONTRACTS
TOURNAMENTS
BEHAVIOR
REWARD
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