This paper offers a model of individual well-being that takes into account
cognitive factors. It postulates that individuals compare payoffs to aspira
tion levels. The latter are determined by past experiences (adaptation), by
other people's performance (interpersonal comparison), as well as by reaso
ning (justifications and excuses). We axiomatize a measure of well-being de
fined on real-valued vectors of various lengths. It is a linear combination
of differences between payoffs and aspiration levels. where the aspiration
level at each instance is a linear function of past payoffs.