This post by Birdsleep contains an excellent link to research on the topic of empathy http://www.wrongplanet.net/postp6265172.html#6265172.
The topic is a source of a lot of confusion because empathy is a very broad term that covers several distinct aspects. Researchers sometimes qualify which aspect they are looking into as for example in the paper referenced in the above post, which explores emotional empathy (EE is an emotional response in an individual that stems from and parallels the emotional state of another individual.) vs. cognitive empathy (CE is the ability to understand and predict the behavior of others in terms of attributed mental states, particularly epistemic mental states such as believing, knowing, pretending, and guessing.).
Some of the most interesting observations from the paper are highlighted below:
In this article, I distinguish between direct EE (i.e., spontaneous EE not derived from CE ) and indirect EE (i.e., EE derived from CE ). Direct EE can occur as a response to overt cues, such as another?s facial expressions or emotional vocalizations. Indirect EE depends on an understanding of another?s mental state and involves the ability to share an emotional state that is inferred but not observed. With direct EE , the empathizer may or may not be fully aware that he or she is sharing the emotion of another. ... CE appears to be adaptive because it underpins sophisticated verbal and nonverbal communication, Machiavellian intelligence, general social expertise, and parenting skills. EE provides a basis for social bonding, parent?offspring bonding, helping behavior, and group cohesion.
Autistics have difficulty in picking up nonverbal communication and in intuitively picking up competitive social games, i.e. we are perceived as socially naive. At the same time some of us have a very high level of emotional empathy or sympathy, and are directly affected by the emotions of those around us, but we may react in untypical ways or be incapable of a visible reaction depending on the context and the strength of the emotional trigger.