Danny Kahneman is the father of behavioral economics, and writes many interesting things. I think the implications of this school are vastly overstated, but he's a thoughtful, interesting, person.
He gave a talk at TED.org recently on experience vs. memory. His main idea is that there are two kinds of 'happiness', that which is experienced in a particular moment, and that which is remembered. The experiencing self that lives in the present, and is relevant when a doctor asks ‘does it hurt when I do this’? The remembering self is present, as when we ask ‘how was your vacation’? Happiness can be the memorizing self over time, or happiness when someone thinks about their life.
He mentions that these two aspects are very different, and lead to different objectives. The correlation between people’s experiential vs. remembered happiness is 0.5, which is why you can ask someone ‘are you happy now?’ and get no correlation with income over $60k, and ‘are you happy with your life?’, and get a significant correlation with income over $60k. It’s the difference between being happy in your life, and being happy about your life.
The difference between the two has been documented by by many experiments. For example, during colonoscopies in the 1990’s, back when the procedure was unambiguously painful, subjects would record their pain every minute. If you think of the pain going over a bell curve over time (rising and falling symmetricall), an experience that stopped at the top of the curve would be better than one that road the curve over its entire path. Yet the remembered experience that stopped at the top would be remembered worse, because the diminution of pain at the lower ending point would make the longer experience with more total pain seem ‘better'.
People choose mainly between memories of experiences vs. just experiences, and generally prefer the memorizing self vs. the experiencing self.
You can predictably manipulate the remembered experiences by manipulating endings. In the colonoscopy case, just remember to draw the procedure out longer, making it slightly less painful every minute, even though the procedure is functionally over. Go on a 1 week vacation instead of 2, because you will remember the experience it the same, as the memory of going to Greece is basically allocated a unit regardless of length once you go over a couple of days. This explains why people generally like having children, and find them adding to their life’s satisfaction, yet generally don’t like playing or interacting with their children.
Anyway, listen to the talk, it’s very interesting (though I just told you the main points).