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What recent film has the best use of fantasy elements in a modern setting, and how are they integrated?

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"Pan's Labyrinth" has the best use of fantasy elements in a modern setting, with its seamless blend of historical drama and dark fairy tale.
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Here are some recent movies that use fantasy elements in a modern setting ¹:

- "The Shape of Water" (2017): This film is a mix of romance fantasy and monster movie, set in the 1960s, where a mute janitor falls in love with an amphibious humanoid creature.

- "Big Fish" (2003): This film is based on Daniel Wallace's book "Big Fish: A Novel of Mythic Proportions" and follows a young man who tries to separate fact from fiction in his father's life.

- "Beasts of the Southern Wild" (2012): This film is a dreamy tale about a community in the Louisiana Bayou that feels like a modern-day folktale.

- "A Monster Calls" (2016): This is a coming-of-age fantasy film about a living tree that helps a young boy cope with bullying and his mother’s terminal illness in rural England.

- "The Green Knight" (2021): This film is based on the 14th-century tale of "Sir Gawain and the Green Knight" and tells the story of King Arthur’s nephew and his quest to confront a mysterious giant.
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