The Logic of Life: The Rational Economics of an Irrational World

Life seems illogical sometimes. Individuals do risky things: take drugs, have unprotected sex, mug each other. If you've ever been in love, you know how crazy it feels, and divorce rarely looks like a rational process. The unfathomable appears on a larger scale: why do some neighborhoods thrive while others become ghettos, some cities live while others die? Why is the United States a democracy while China is not? Thorny questions, and you might think the outcome is impossible to predict. But economists believe that life is logical, and rational patterns often underpin what looks like chaos or confusion.

THE LOGIC OF LIFE reveals that rational behavior appears in the most unexpected places: drug addicts and muggers behave rationally. Suburban sprawl and inner city decay also follow rational patterns. Economics can explain how teenagers decide whether or not to have sex, why your boss is overpaid, and why your neighborhood is segregated. Using economic tools to pry open the...