Final answer:
Children begin to compare themselves with peers and develop a sense of competence or inferiority during the school age stage (7-11 years), following Erikson's theory of psychosocial development.
Step-by-step explanation:
Children compare their own values and activities with those in the world around them at the school age stage of development, specifically from ages 7-11. This period corresponds to Erikson's stage of industry versus inferiority, where children either develop a sense of pride and accomplishment or feelings of inferiority when they can't measure up to their peers.
To help children develop a sense of competence and a belief in their abilities, parents and teachers can provide support and encouragement, set realistic expectations, celebrate their achievements, allow them to make choices and experience consequences, and foster a positive learning environment. Recognizing individual strengths and fostering a sense of mastery in different areas are key components to building a strong self-concept in children.