- A principle of welfare economics derived from the writings of Vilfredo Pareto , which states that a legitimate welfare improvement occurs when a particular change makes at least one person better off, without making any other person worse off. A market exchange which affects nobody adversely is considered to be a ‘Pareto-improvement’ since it leaves one or more persons better off. ‘Pareto optimality’ is said to exist when the distribution of economic welfare cannot be improved for one individual without reducing that of another.The principle rests on three assumptions: that each individual is the best judge of his or her own welfare; that social welfare is exclusively a function of individual welfare; and that if one individual's welfare is augmented, and nobody's is reduced, then social welfare has increased. Since these assumptions are empirically questionable, and probably embody value-judgements about well-being and satisfaction, they are somewhat controversial. It has also been argued that they constitute a rather weak basis for welfare judgements, since they explicitly forbid interpersonal comparisons, are concerned entirely with the subjective choices of individuals, and privilege the position occupied by the status quo (since any move from the status quo which was vetoed by one person would not be considered a Pareto-improvement). Most sociologists object to Paretian welfare economics because of its silence on the initial distribution of resources.
Dictionary of sociology. 2013.
Look at other dictionaries:
Pareto principle — The Pareto principle (also known as the 80 20 rule, the law of the vital few and the principle of factor sparsity) states that, for many events, 80% of the effects come from 20% of the causes. Business management thinker Joseph M. Juran suggested … Wikipedia
Pareto principle — Put in terms of preferences, this is the principle that (i) if everyone in a society is indifferent between two alternatives then the society should be indifferent as well, and (ii) if at least one individual prefers x to y, and everyone else… … Philosophy dictionary
Pareto Principle — A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The principle states that, for many phenomena, 20% of invested input is responsible for 80% of the results obtained. Put… … Investment dictionary
Pareto principle — noun the principle that describes the phenomenon wherein a small percentage of a population accounts for a large proportion of a particular characteristic of that population e.g. that a small proportion of users account for a large proportion of… … Wiktionary
Pareto principle — economic principle stating that an economic policy is desirable if it suits part of the population and does no harm to the rest … English contemporary dictionary
the Pareto principle — UK US noun [S] (also Pareto s law , INFORMAL the 80/20 rule) ECONOMICS, WORKPLACE, PRODUCTION ► the idea that a small quantity of work or resources (= time, money, employees, etc.) can produce a large number of results: »The Pareto principle,… … Financial and business terms
Pareto efficiency — Pareto efficiency, or Pareto optimality, is an important concept in economics with broad applications in game theory, engineering and the social sciences. The term is named after Vilfredo Pareto, an Italian economist who used the concept in his… … Wikipedia
principle — prin‧ci‧ple [ˈprɪnspl] noun 1. [countable, uncountable] a moral rule or set of ideas that makes you behave in a particular way: • The single European market works on market principles. • As a matter of principle (= a rule that is very important … Financial and business terms
Pareto — can refer to:*Vilfredo Pareto (1848–1923), Italian sociologist, economist and philosopher; *Paula Pareto (born 1986), Argentine judokaSeveral things named after Vilfredo Pareto:*Pareto chart, an ordered bar chart used in statistical quality… … Wikipedia
Pareto analysis — is a statistical technique in decision making that is used for selection of a limited number of tasks that produce significant overall effect. It uses the Pareto principle the idea that by doing 20% of work you can generate 80% of the advantage… … Wikipedia