Science is the great antidote to the poison of enthusiasm and superstition. —Adam Smith on motivated reasoning

The road to happiness is rocky. Some folk psychologists argue that happiness is a choice—that it is up to you, that you can find happiness in your beliefs, that you may believe ideas that bring pleasure or peace, and that there is utility in what you believe. The philosopher and economist Adam Smith took a more skeptical view on such motivated reasoning, rhetorically asking, “What can be added to the happiness of a man who is in health, out of debt, and has a clear conscience?”

Let’s begin with the term “utility.” Utility is the economist’s term for happiness. Utility maximizers are those who seek the greatest happiness.

Unlike the vernacular word “happiness,” the term “utility” has instrumental implications. It means that something can be “used” in order to satisfy a desire or interest. The word “happiness” is broader. It allows you to just sit and be “happy.”

The neo-liberal lexicon does not have an adjective for “utility.” The word “utilitarian” will not do as it refers only to choices and the process of choosing, but not to the states that result from these choices (n.b., some utility modelers will disagree with this statement). You cannot just sit and feel “utilitarian.” Utilitarianism requires action.

With the rise of behavioral economics, psychology has returned to inform economic thinking. One of the pioneers of behavioral (i.e., psychological) economics is George Loewenstein of Carnegie Mellon University. Among his many contributions is the resuscitation of the idea of “belief utility.” Recently, Molnar and Loewenstein (hereafter ML) published a concise summary of this effort (2022). The present essay is a selective summary of that summary,........

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