Discussion
If one person can be made better off without making any other person worse off, it is called ............... .
Answer: C
It is called a Pareto improvement.
A Pareto improvement is a change that makes at least one person better off and nobody worse off. Pareto efficiency (optimality) is the state where no such improvement remains: nobody can be made better off without making someone worse off.
So the described move is an improvement, not efficiency itself. Maximum social welfare needs a social welfare function, and interpersonal comparison of utility is exactly what the Pareto criterion avoids.
No comment is present. Be the first to comment.
Loading…
Post your comment
Please log in or register to post a comment.
Examination Categories
- SSC Exams
- Banking Exams
- Teaching Exams
- Civil Services Exams
- Railways Exams
- Engineering Recruitment Exams
- Defence Exams
- State Government Exams
- Police Exams
- Insurance Exams
- Nursing Exams
- Other Government Exams
- NRA CET
- PG Entrance Exams
- Campus Placement
- MBA Entrance Exams
- CUET and UG Entrance
- Judiciary Exams
- Regulatory Body Exams
- Software Development