The Economist, who seem to have a run of psychology article of late, has a brief article discussing theories of why we laugh:
Why do people laugh at all? What is the point of it? Laughter is very contagious and this suggests that it may have become a part of human behaviour because it promotes social bonding. When a group of people laughs, the message seems to be “relax, you are among friends”.
But laughter does not unite us all. There are those who have a pathological fear that others will laugh at them. Sufferers avoid situations where there will be laughter, which means most places where people meet.
Link to article “Poking fun”.