The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Pareto Principle and Competing Principles

  • Louis Kaplow
Reference work entry
DOI: https://doi.org/10.1057/978-1-349-95189-5_2287

Abstract

The Pareto principle, the seemingly incontrovertible dictum that if all individuals prefer some regime to another then so should society, may conflict with competing principles. Arrow’s impossibility theorem and Sen’s liberal paradox are two notable examples. Subsequent work indicates more broadly that the Pareto principle conflicts with all non-welfarist principles. This essay surveys these results, including various extensions thereof, and offers perspectives on the conflict, drawing on classical and contemporary work in political economy and economic psychology.

Keywords

Arrow, K. Arrow’s impossibility theorem Behavioural economics Bentham, J. Darwin, C. Harrod, R. Harsanyi, J. Hume, D. Interpersonal utility comparisons Liberal paradox Mill, J. S. Pareto principle Philosophy and economics Psychology and economics Rawls, J. Robbins, L. Second best Sen, A. Sidgwick, H. Smith, A. Social choice Social welfare function Welfare economics 

JEL Classifications

D63 H43 
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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Louis Kaplow
    • 1
  1. 1.