If you’ve ever met me in person, you know I talk a lot about utility. My close friends are used to answering questions like “does this have net positive utility to you?” and “is that a strongly weighted component of your utility function?”. Every time I make a decision – what to do with my evening, or what to do with my life – I think about it in terms of utility.
I didn’t always do this, but I’ve adopted this way of thinking because it forces me to clarify everything that’s going on in my head and weight all my thoughts appropriately before making a decision. When I decide things this way, I genuinely feel like I’ve made the best possible choice I could, given everything I knew at the time.
What on earth is utility?
Utility is just a fancy word for “value”. If you enjoy chocolate ice cream, then eating chocolate ice cream has positive utility. If you don’t enjoy vanilla ice cream, then eating vanilla ice cream has negative utility.
One action can have multiple kinds of utility. You can add together all the utility types to get the action’s net utility. For example, if I assign positive utility to eating ice cream but a negative utility to gaining weight, there will be a certain optimal point where I eat as much ice cream as I can without gaining weight. Maybe, if I assign eating ice cream +5 utility, not gaining weight +5 utility, and exercising -5 utility, then it would make sense for me to hit the gym more often so that I can eat more ice cream without gaining weight.
Having numbers that are consistent is helpful sometimes, but isn’t strictly necessary. When I need to make quick, relatively straightforward decisions, I typically just make up some utility numbers. This is still useful, though, because utility calculations in a small isolated system are basically matters of ratios. It doesn’t matter exactly how much utility I assign to something, but if X has 5 more utility points than Y, X is preferable.
Forcing yourself to make up numbers and compare them to each other reveals what you care about. If you initially thought you didn’t care much about something, but then realize that if you calculated net utility with a low number assigned to that thing, you’d be unsatisfied with the result, then you care more than you thought you did.
It might be somewhat unclear, with my super-simple examples so far, what you can assign utility to. So, here are some examples of things that I assign positive utility to:
- Reading good books
- Doing new things
- Increasing utility according to the utility functions of people I care about
- Building neat software
- Drawing with markers
- Writing stories and blog posts
- Improving/maintaining my mental and physical health
- Having interesting conversations
- Improving the quality of life of all sentient beings
- Riding my bike
- Taking walks with my fiance
- Figure skating
- Eating ice cream
If you enjoy doing it, if you think you should do it, if it makes you happy, if it’s a goal you have for some reason, or anything else like that, you assign it some amount of positive utility. You can even assign positive utility to things you don’t end up doing. That’s because the net utility, after accounting for circumstances or mutually exclusive alternate actions. Knowing that you would do something, barring XYZ condition, is a useful thing to know in order to dissect your own thoughts, feelings, goals, and motivations. The converse is true, too: you can assign negative utility to things you end up doing anyway, because the net utility is (perhaps barely) positive.
So if that’s utility, what’s a utility function?
A utility function is a comprehensive set of everything that you assign any utility to – aka, that you care about in any way. The inputs are quantities of certain events, each of which are multiplied by their respectively-assigned utility value and then added together to get the total expected utility of a given course of action.
Say I’m with my sister and we’re going to get food. I personally assign a strong net positive to getting burgers and a weak net negative for anything else. I also assign a positive utility to making my sister happy, regardless of where we go for food. If she has a strong net negative for getting burgers, and a weak net positive for sushi, I can evaluate that situation in my utility function and decide that my desire to make her happy overpowers the weak negative I have for anything besides burgers, so we go get sushi.
When evaluating more complex situations (such as moving to a job across the country, where positives include career advancement and increased income, and negatives include having to leave your home and make new friends), modeling your own utility function is an excellent way to parse out all the feelings that come from a choice like that. It’s better than a simple list of pros and cons because you have (numeric, if you like) weights for all the relevant actions.
How to use your utility function
I don’t keep my entire utility function in my head at one time. I’ve never even written it down. But I make sure I understand large swaths of it, compartmentalized to situations I often find myself in. However, if you decide to actually write down your utility values, make them all consistent, and actually calculate utility when you make decisions, there’s nothing stopping you.
In terms of the optimal way to think about utility calculations, I have one piece of advice. If you come out of a utility calculation thinking “gotcha, I can do this”, “alright, this seems reasonable”, or even “ugh, okay, I don’t like it but this is the best option”, then that’s good. That’s the utility function doing its job. But, if you come out of one thinking “hmmm… I guess, but what about XYZ contingency? I really don’t want to do ABC…”, or otherwise lingering on the point of decision, then you’ve forgotten something.
Go back and ask “what’s wrong with the ‘optimal’ outcome?”. It might be something you don’t want to admit to yourself, but you don’t gain anything by having an inaccurate perception of your own utility function. Remember that “I don’t wanna” is a perfectly valid justification for assigning negative utility to an action. In order for this process to work, you need to parse out your desires/feelings/goals from your actions, without beating yourself up for it. Your utility function already is what it is, owning up to it doesn’t make it worse.
Once you have a pretty good handle on your own utility function, you can go ahead and mentally model other peoples’. Humans are calculating utility all the time in the form of preferences and vague intuitions, so even if other people don’t know their utility functions, you can learn them by a combination of watching their actions and listening to their words. (The discrepancy between those two, by the way, is indicative of the person choosing an action with suboptimal utility. You can point out this discrepancy politely, and perhaps help them to make a better decision.)
You might be surprised at how much easier it is to make group decisions once you know how everybody’s utility calculations will go.