People laugh for a number of reasons. The psychic response to the act of laughing is positive, for one reason or another, possibly triggered by lack of oxygen - I figure this because the physiology of laughter is bearing your teeth and tightening your diaphragm, which naturally would result in less oxygen, which makes one euphoric (obviously the bearing of teeth is not related to this.) But even a small lack of oxygen will create a slightly euphoric state I suppose - it may not be enough for you to notice consciously, if for no other reason than that your consciousness is distracted by what you find funny, but your subconscious would surely pick this up, and you would realize that you have the opportunity to focus consciously on this state, continue the diaphragm spasm, and will pleasure upon yourself.
But the question is not answered. Why will pleasure upon yourself? The obvious answer is because there is not an adequate amount of it at the time. Thus, we could come to the conclusion that laughter should come at a time of discomfort. We grieve when an emotional event that we understand rationally disturbs us, but laughter, an immediate response that requires little to no reflection (tickling?), could come at a time of misfortune that is affecting us not on a rational level, but rather on a direct, physiological level, such as when our blood pressure is risen. Siddhartha rolled the dice and lost a large amount of property. In an attempt at good humor and sportsmanship, he laughed - but he laughed a little too loud.
I asked my girlfriend the other day, when I was following a similar train of thought, when did she laugh most passionately?
Her answer was, "When I'm embarrassed." She is an extraordinarilly introverted girl, and this made me realize that laughing normally occurs in groups. I laugh to myself when I come to an intuitive realization that I feel I should have understood earlier. I must laugh because I'm more stupid than I wish I was. Most of the time that people laugh to themselves, it is in this spirit.
One does not laugh without an object. Often the object is a person, or a person's actions. We don't laugh when they say they've solved a tricky problem (unless we are laughing at our own incompetence like I stated a moment ago), we laugh when they try to impress everyone at the table by ordering in French and look foolish because they forgot we were at a Mexican restaurant. In this case, we laugh at their stupidity. Everytime we laugh, it is at something that is wrong - something that is inconsistent.
But why, why, why?!
Let's say that some actor tripped and fell down the stairs during a play, (don't worry, he didn't break a leg) and the auditorium fills with laughter - Why? Here's a suggestion: In this situation, laughing with all of the others, you would feel a comradery with the others in the auditorium, because an event involving a contradiction that you intuitively believe made an impact on the others, just like you. You intuitively know they are just like you, in at least this one way. So you use laughter to grow closer to them.
But what of the object? In an auditorium, you would not feel so sorry for the actor. You would realize his misfortune but it would not affect you emotionally - not in any remarkable way at least. I will suggest a reason for this.
-When laughing at another's misfortune, one is accomplishing two objectives simultaneously.
-One objective is to correct the pain of your empathy with the object.
-One objective is to grow closer to the others who laugh.
-The ratio of the feeling of comradery to the feeling of empathy is directly correlated to the number of people who are present, laughing.
The fourth axiom is affected by your relationship with the object of laughter.
Someone who embarrasses themselves in front of ten laughing people will meet with a wall that is being cemented - the ten people laugh at, with little consideration for her. If the same embarrassing thing happens to her, and the only two people with her can't help but laugh, they would be using it more empathy toward her than closeness to eachother. If they can't help but laugh, they are doing it to overcome the empathy, not to bond with eachother. As I have already noted, in an auditorium filled with people, we feel almost no emotional connection with a tripping actor. To emphasize: this is because the audience has enough people on their side of the equation to avoid personal responsibility. In short, the emotional reaction of the embarrassed person is matched by those who see it - and the fewer people who see it, the more likely the embarrassed person's consciousness is directed toward them, giving them a personal responsibility to be emotionally responsive to the object of embarrassment.