Daniel Kahneman, the psychologist who won an economics Nobel, talked at Edge.org. Transcript.
it turns out that experience utility can be defined in at least two very different ways. One way is when a dentist asks you, does it hurt? That's one question that's got to do with your experience of right now. But what about when the dentist asks you, Did it hurt? and he's asking about a past session. Or it can be Did you have a good vacation? You have experience utility, which is everything that happens moment by moment by moment, and you have remembered utility, which is how you score the experience once it's over.
And some fifteen years ago or so, I started studying whether people remembered correctly what had happened to them. It turned out that they don't. And I also began to study whether people can predict how well they will enjoy what will happen to them in future. I used to call that "predictive utility", but Dan Gilbert has given it a much better name; he calls it "affective forecasting". This predicts what your emotional reactions will be. It turns out people don't do that very well, either.
I want to be snide and say, "and we try to elicit reports of how happy someone is in the present. And it turns out that people don't do that very well, either."
Whether you are a believer or a skeptic in what he does, I recommend the talk.