Pareto Efficiency

Allocation from which no one can be made better off without making someone else worse off; the welfare benchmark.

Specifications & Metrics

Pareto's Manuale di economia politica (1906) separated efficiency from distributional judgment.
Competitive equilibrium allocations are Pareto efficient under the first welfare theorem's assumptions.
A Pareto improvement helps someone and harms no one; most real policy instead trades winners against losers.