Pareto optimality (1906)

Named after Italian sociologist and economist Vilfredo Pareto (1848-1923), Pareto optimality is a situation which exists when economic resources and output have been allocated in such a way that no-one can be made better off without sacrificing the well-being of at least one person.

Also see: social welfare function, compensation principle, cost-benefit analysis, scitovsky paradox

Source:
V Pareto, Manuale d’economia politico (Milan, 1906)

English

English Wikipedia has an article on:

Pareto efficiency

Alternative forms

  • Pareto-optimal

Adjective

Pareto optimal (comparative more Pareto optimalsuperlative most Pareto optimal)

  1. (game theory, economics) Describing a situation in which the profit of one party cannot be increased without reducing the profit of another.
  2. (game theory) Describing a strategy that cannot be made to perform better against one opposing strategy without performing less well against another.

One thought on “Pareto optimality (1906)

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