Harvard psychologist William McDougall says that there are two kinds of happiness: feel-good and value based.
Feel-good happiness is sensation-based pleasure. When we joke around or have sex, we experience feel-good happiness. Since it is ruled by the law of diminishing returns, the kicks get harder to come by.
Value-based happiness, on the other hand, is a sense that our lives have meaning and fulfil some larger purpose. It represents a spiritual source of satisfaction, stemming from our deeper purpose and values.