Pareto Principles: Difference between revisions
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Economics deals with the allocation of scarce resources. Vilfredo Pareto's work deals with the concept of what happens when those scarce resources are re-allocated. He did this looking at utility and more specifically, marginal utility and the collective maximization of such; thus his work is of great interest to the theory and study of welfare economics.[1] Pareto's work spans a variety of studies from welfare economics to political economy to legal economics and others.
There are two main theories within his works collectively referred to as Pareto Principles:
- Pareto Improvement
- Pareto efficiency or Pareto Optimization
These concepts deal with the efficient allocation of goods in society and the different configurations which can increase or maximize the benefits from an allocation.
References
- ↑ R. Marchionatti and F. Mornati, ed. Considerations on the Fundamental Principles of Pure Political Economy. New York: Routledge, 2007, pp. xi.