No one could argue with a straight face that the couples getting married today are much happier just because their wedding celebrations cost three times as much as those in 1980. Bigger mansions and costlier parties are wasteful in the same sense that larger antlers on all bull elk are wasteful. The good news is that simple changes in the tax system can eliminate much of this waste without having to deny people the right to decide for themselves how best to spend their money.
Robert H. FrankQuestions 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.
Robert H. FrankEconomics, as it is often taught today, portrays us as homo economicus-someone who doesn't vote in presidential elections, doesn't return lost wallets, and doesn't leave tips when dining out of town. Julie Nelson reminds us that most people aren't really like that. She helps point the way to a richer, more descriptive way of thinking about economic life.
Robert H. FrankThe most glaring deficiency in traditional economic models is that they completely ignore the role of context in evaluation.
Robert H. FrankAdam Smith's uncritically enthusiastic modern disciples portray his invisible hand theory as saying that market forces reliably harness selfish individuals to serve the common good. That's often true, but as Darwin recognized clearly, many traits that serve the interests of individual animals make life more difficult for larger groups.
Robert H. Frank