Pareto criterion

Pareto criterion

Any criterion for allocating an economy’s resources at “unity”, where re-allocation of resources cannot improve conditions for one person or group, without worsening conditions for others.
References in periodicals archive ?
Menus cannot usually be ranked by the Pareto criterion.
The uninformativeness of the Pareto criterion with linear u can be stated as a formal result.
Therefore, Kaldor-Hicks efficiency criterion is more real than Pareto criterion and is more acceptable in economic analysis of law.
In other words, the Pareto criterion with actual compensation embodies a value judgment in favor of the status quo, just as the potential-compensation criterion embodies one against it.
Interestingly, though, he still adduces the Pareto criterion, which is deeply rooted in utilitarian thought, to show that an act of original appropriation always increases social welfare while property seizure does not.
The Pareto criterion simply states that a solution is better than another one if it is as good in all attributes, and better in at least one of these attributes.
It is in this sense that "the Pareto criterion has been thought to be an expression of individual liberty.
The Pareto criterion would not be widely accepted unless it takes account of moral harms; but: if it does take account of moral harms then there is no reason to doubt that egalitarian concerns can be incorporated into the Pareto argument.
Unlike the Pareto criterion, which considers both efficiency and equity to be a requirement of welfare gain, the compensation principle deals with the issue of efficiency only and leaves the issue of equity (actual payment of compensation to the losers) to the policymakers.
Buchanan (1967) writes, "it is evident that [unanimous consent] is the political counterpart of the Pareto criterion for optimality" (p.
In part 5, de Jasay examines Amartya Sen's argument that the Pareto criterion (licensing any transfers that make nobody worse off by his own lights) clashes with libertarian values because it allows the voluntary transfer of liberties that are properly inalienable.
And, similar to Sen's analysis, the analysis here suggests that the Pareto criterion is not adequate for the formation of public policy.