Life is graded on the curve. It's not how big you are, how strong you are, how smart you are. It's how good you are at the things that count relative to the people around you.

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.

All parents want to send their children to the best possible schools. But because a good school is a relative concept, a family cannot achieve its goal unless it outbids similar families for a house in a neighborhood served by such a school. Failure to do so often means having to send your kids to a school with metal detectors at the front entrance and students who score in the 20th percentile in reading and math. Most families will do everything possible to avoid having to send their kids to a school like that. But because of the logic of musical chairs, they're inevitably frustrated.

The most glaring deficiency in traditional economic models is that they completely ignore the role of context in evaluation.

The private sector is first of all much larger than the public sector. The waste we see in that sector does not result from the fact that people spend their money carelessly. Mostly, it occurs because what one family must spend to achieve its goals often depends heavily on what other families spend.

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

Economics, 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.