The ability to appreciate other people’s agony is achieved by the same parts of the brain that we use to experience pain for ourselves.
In other words, Adam Smith, a crazed bachelor writing in remote Scotland, and with no real means of making empirical measurements, nailed it. Some people’s introspection is better than others, here is Smith on sympathy. Read the full story about the recent work in neuroscience, here is another account. Here is a page for the researcher, Tania Singer.