Affect is a generalization of profit

As an agent, you need to be able to navigate complex scenarios very quickly. For example, if a tiger attacks you, you don’t have much time to ponder what’s going on. You need to act immediately.

One way this might be handled is with evolutionarily designed modular mental programs and circuits for activating behaviors quickly in relevant situations. But the evidence doesn’t support the existence of such modules and circuits, and a system of pre-made, inflexible reactions would be both slow and inaccurate. Even if an organism with these systems could exist, it would be weeded out by natural selection.

A different way of looking at things is the idea that the body is a system of internal resources, the survival and behavior of which is determined by the allocation of those resources. In other words, the body is an economy, and to survive and thrive, it needs to solve the economic problem of the allocation of scarce resources. Rather than operating as a thinker or a planner, the brain’s basic task is to serve as a resource-regulator, balancing the internal resource and energy budget of the body so as to achieve metabolic efficiency. The brain is constantly anticipating events that threaten to disrupt its metabolic efficiency and constructs potential actions to address those threats ahead of time, allowing the organism to act in a speedy and accurate manner in response to (or in anticipation of) a predator attack.

To manage the internal milieu, the brain has to somehow process a tremendous amount of data from the body, the brain, and the environment. There is far too much information for the brain to sort through on its own. Instead, the brain relies on a low-dimensional summary of this information called affect, which can basically be thought of as a feeling or a mood that varies along a few dimensions, most notably magnitude and valence—positive or negative—but also dimensions like effort. That is to say, instead of trying to work with a huge amount of data to make decisions, the brain compresses all of that data into a conscious feeling of, e.g., feeling moderately positive or mildly negative. This is very useful because as long as affect correlates with reesource regulation, so that, say, a mildly positive affect means you’re doing a slighty better-than-normal job of resource regulation, and a strongly negative affect means you’re doing a terrible job of resource regulation, then the brain can simplify its task to one of regulating affect rather than regulating resources. Basically, this means that the brain’s job can be thought of as trying to feel good and not feel bad. For example, the brain can judge competing action plans in the anticipated event of a predator attack by comparing them in terms of which one is expected to do a better job of regulating affect, which is easier than analyzing them in terms of how well they serve the much more complex task of resource regulation.

The role that affect serves in the brain is highly analogous to the role that profit serves in a business. Like an organism, a business survives and thrives only if it efficiently manages its internal resources, including the tasks of expelling waste and acquiring new resources from the external environment. And like an organism, the amount of information flowing inside a business is way too much to analyze directly. As a result, businesses rely on a low-dimensional summary called profit, which occurs naturally to condense all of the interactions influencing the business into a simple number. Like affect, profit varies on dimensions of magnitude and valence: e.g., you could have a large positive profit, or a small negative profit. And like affect, profit allows the business to greatly simplify its decision-making by behaving so as to regulate profit rather than regulating internal resources.

There are other similarities as well. It’s simple to think of positive affect and positive profit as good signs, while negative affect and negative profit are bad signs. However, this isn’t necessarily true. Both affect and profit basically represent a net inflow of resources, but there are times when a negative net inflow is good and a positive net inflow is bad. For example, exercise may cause negative affect, but that negative feeling might be conceptualized as a good sign. Similarly, negative profit might simply be the result of investments that are expected to eventually pay off in a big way. Additionally, positive affect could be conceptualized as bad when it is, e.g., the result of procrastinating when you should be working, or from eating something unhealthy. Similarly, positive profit might be conceptualized as bad if it’s understood as the consequence of a too-safe strategy or a lack of investment opportunities, or even something like the failure of a loss-leader to attract customers. It’s not sufficient, therefore, to simply try to keep affect and profit positive all the time. The brain and the business owner need to make sense of their affect/profit in context and use that understanding to guide behavior.

Both affect and profit are also subject to externality. An externality is something that affects the resource regulation of the organism or firm but doesn’t influence their affect or profit, respectively. For example, a human being might happily hang out in the presence of carbon monoxide, which has a big effect on their ability to maintain metabolic efficiency, but those interactions either don’t influence affect or don’t do so efficiently relative to their importance. While firms with assets that are traded on the stock market may be expected to factor every relevant consideration into their profit, more isolated firms may fail to have their profit influenced by, e.g., the announcement of a new technology or regulation that spells doom for the firm in the long run.

The fact that psychology apparently has an underlying economic structure in which the brain can be thought of as managing the allocation of scarce resources so as to regulate a psychological analogue to profit suggests that economic theory may describe a sort of conceptual “base template” for organization and structure in contexts other than the usual economy.