The link between rational individual behavior and collectively desirable outcomes is extremely tenuous.

Questions like, "Is my suit OK?", or "Is my job performance satisfactory?", are impossible to think about in the absence of a suitable frame of reference. For an interview suit to serve its purpose, it must make you look good relative to other candidates for the job you want. For your job performance to be satisfactory, it must compare favorably with the performance of others who want the same promotion you do. As Charles Darwin saw clearly, much of life is graded on the curve, and conventional economic models completely ignore that fact.

Unless we can act collectively, there would be no way to defend ourselves, no way to define or enforce property rights. We couldn't curb congestion or pollution or build and maintain public infrastructure.

Only the federal government has the power to spend beyond its current revenue. It shouldn't do that when the economy is at full employment. But it's an essential step for an economy mired in recession.

If the search is for examples that contradict the predictions of standard economic models, a good rule of thumb is to start in France.

When people bump up against one another in the course of pursuing their goals, it is in everyone's interest to resolve any resulting problems in the least costly ways possible.

One reason that might motivate a worker to accept a riskier job at higher pay, for example, would be that doing so would enable him to bid more effectively for a house in a better school district. But if other workers did likewise, none would achieve the goal they were striving for.