The Pareto efficiency

[skeptic]

Economic efficiency - Wikipedia, the free encyclopedia


In economics, the term economic efficiency refers to the use of resources so as to maximize the production of goods and services.[1] An economic system is said to be more efficient than another (in relative terms) if it can provide more goods and services for society without using more resources. In absolute terms, a situation can be called economically efficient if:

No one can be made better off without making someone else worse off.
No additional output can be obtained without increasing the amount of inputs.
Production proceeds at the lowest possible per-unit cost.
These definitions of efficiency are not exactly equivalent, but they are all encompassed by the idea that a system is efficient if nothing more can be achieved given the resources available.

Pareto efficiency does not = efficiency as an economic term. Pareto wasn't even an economist.

 

[Truthmatters]

Given an initial allocation of goods among a set of individuals, a change to a different allocation that makes at least one individual better off without making any other individual worse off is called a Pareto improvement. An allocation is defined as "Pareto efficient" or "Pareto optimal" when no further Pareto improvements can be made.

When no further improvements can be made.


Do you understand what that means?

It means stall.

The balence is at its pinicle and no more NO HARM to others is done.


It means you reanch a point where the lower sector suffers and More ecomnomic gains cazn still be relized by the 20 % but only at the harm of the 80 %.


You dont want to make these realizationss because it harms your poltical point of view.


Its still reality.

 

[skeptic]

Given an initial allocation of goods among a set of individuals, a change to a different allocation that makes at least one individual better off without making any other individual worse off is called a Pareto improvement. An allocation is defined as "Pareto efficient" or "Pareto optimal" when no further Pareto improvements can be made.

When no further improvements can be made.


Do you understand what that means?

It means stall.

The balence is at its pinicle and no more NO HARM to others is done.


It means you reanch a point where the lower sector suffers and More ecomnomic gains cazn still be relized by the 20 % but only at the harm of the 80 %.


You dont want to make these realizationss because it harms your poltical point of view.


Its still reality.

NO
IT
DOESN'T

It means that when it isn't broken you can't fix it. Hence the term "Pareto optimal".

You do know what an optimal state is, right?

 

[Truthmatters]

most favourable or advantageous


Most advantages to whom?

It is the Most advantage the 20 percent can garner without changing the NO HARM part.


Why on gods green earht would you defend such a thing?

 

[Truthmatters]

Now you know why its a fools game to defend what the right wing leaders are defending at your expense

 

[dilloduck]

Now you know why its a fools game to defend what the right wing leaders are defending at your expense

thanks for the info.

 

[Truthmatters]

He discovered this relationship at the begining of a wolrd progressive movement.


The world that exsisted at the time was full of old money.

All of the industrialized nations were begining to lash back at the old money stranglehold on the people.


What is happening now is what happens when the 20 % try to breach acrossed the 80% level.

You get a whole lot of pissed off people who can no longer gain any ground.

 

[Truthmatters]

Can you say massive progressive movement?

I knew you could




http://en.wikipedia.org/wiki/Progressive_Era

the 20 80 effect was found by this man in 1906.

Guess what happened to the world shortly after?

 

[skeptic]

most favourable or advantageous


Most advantages to whom?

It is the Most advantage the 20 percent can garner without changing the NO HARM part.


Why on gods green earht would you defend such a thing?

I am not defending anything on God's green " earht ".

But you have no idea what the Pareto efficiency means. And it's founder never made any kind of claims to an economy stalling when any magic threshold was surpassed.

You imagined all of that after misunderstanding what you read.

Meanwhile back on the real earth...

I obviously agree with your ignorant assumption that a vibrant middle class is the cornerstone of a strong economy. But not for the reasons you cling to in your stupidity. The middle class is a spending class and the stronger it is, the more dominant it is within an economy, the higher the level of money velocity there is, the more borrowing occurs, the more the effective money supply increases. And effective money supply is absolutely the lynchpin of economic growth.

But there is a caveat, the American middle class wastes far too many resources and the Earth, the world's poor and the human race can no longer trust the American middle class with money. Case closed.

Give an american $2000 more/year in disposable income and he/she might waste all of that on a bigger suv that wastes oil gratuitously. That is as much oil as could be purchased with the entire income of 10% of the world. The poorest 10% of the world. Wasted, for nothing, except to satisfy the absurd consumerist demands of some obese lazy American SLOB.

What you have to come to terms with, TM, is that you ARE the wealthiest 5%, and you are far more destructive to humanity than the wealthiest 5% of Americans are. Because you spend far more of your expendable income wastefully destroying critical resources than the uber rich do.

The world's poor can not support your waste, extravagance and sloth. You are the leech sucking the life out of the poorest 2/3 of humanity.

And you are far too stupid to realize it.

 

[Baruch Menachem]

Its also called the 20 80 rule.

an economy can have 20% of the people holding 80 percent of the wealth without causing harm to anyone.

You get under the 20 % or over the 80 % and someone is being harmed.

Where do these numbers come from? IF you pulled them from where I think you pulled them, I don't want to touch them.



The whole point to free markets is they find the "paretto efficiency" very quickly. Free trade means both folks make a bargain that both find advantageous to them.

 

[skeptic]

Where do these numbers come from? IF you pulled them from where I think you pulled them, I don't want to touch them.



The whole point to free markets is they find the "paretto efficiency" very quickly. Free trade means both folks make a bargain that both find advantageous to them.

100% correct. But that free market doesn't exist.

 

[Truthmatters]

The 20 80 rule is not pulled from anyones ass.

I have told you repetely that they came from the number of land owners in Italy where Pareto lived.

He then used the information on many other coutnries and found the correlation of 20 80.


When you deny science to allow you to retain failed ideas it is time to get new ideas.

 

[Truthmatters]

most favourable or advantageous


Most advantages to whom?

It is the Most advantage the 20 percent can garner without changing the NO HARM part.


Why on gods green earht would you defend such a thing?

I am not defending anything on God's green " earht ".

But you have no idea what the Pareto efficiency means. And it's founder never made any kind of claims to an economy stalling when any magic threshold was surpassed.what you are failing to see it why did he repetedly find this ratio of 20 80? The reason is that at the time in history of erurope this is the balence achieved naturally before the people revolt because of the harm done to their lives if the 20 % reached for more beyond this point. Pareto may have very well said it himself but the wiki article is not that long huh? You see it is infered in the data. Being a thinking human being I could see the inferance. IT is undeniabley true that when you oppress a people at some point they revolt, where is the breaking point? Its OBVIOUSLY when they feel harmed huh? To pretend you cant not understand thbis very basic human idea is proof of just how indoctrinated you are with the idea that the wealthy have a right to as much as they can steal from the general populace.

You imagined all of that after misunderstanding what you read.
You are blind
Meanwhile back on the real earth...

I obviously agree with your ignorant assumption that a vibrant middle class is the cornerstone of a strong economy. But not for the reasons you cling to in your stupidity. The middle class is a spending class and the stronger it is, the more dominant it is within an economy, the higher the level of money velocity there is, the more borrowing occurs, the more the effective money supply increases. And effective money supply is absolutely the lynchpin of economic growth.

But there is a caveat,the American middle class wastes far too many resources and the Earth, the world's poor and the human race can no longer trust the American middle class with money. Case closed.
Give an american $2000 more/year in disposable income and he/she might waste all of that on a bigger suv that wastes oil gratuitously. That is as much oil as could be purchased with the entire income of 10% of the world. The poorest 10% of the world. Wasted, for nothing, except to satisfy the absurd consumerist demands of some obese lazy American SLOB.

What you have to come to terms with, TM, is that you ARE the wealthiest 5%, and you are far more destructive to humanity than the wealthiest 5% of Americans are. Because you spend far more of your expendable income wastefully destroying critical resources than the uber rich do.

The world's poor can not support your waste, extravagance and sloth. You are the leech sucking the life out of the poorest 2/3 of humanity.

And you are far too stupid to realize it.

Pretty weird you getting all puffed up about the poor and trying to claim I being a middle class American do more damage than say the wealthy of the world like Mubarak and Gahdafi after I just made a case for treating the world poor with much more reverance if for no other reason but to protect a stable economy.


I dont know what or who you are but you really do hate America and Americans and dont like it when someone makes a case for NOT allowing the wealthy to run like steamrollers over the rest of the people.

 

[skeptic]

Look, if it is a bad thing for the top 10% of Americans to hoard 90% of the wealth inside America then it is a far worse thing for the top 10% of the world's rich to hoard 90% of the world's wealth.

You are the very evil you rail against and a hypocrite.

Besides you still can't even understand the topic you introduced.

 

[asterism]

The 20 80 rule is not pulled from anyones ass.

I have told you repetely that they came from the number of land owners in Italy where Pareto lived.

He then used the information on many other coutnries and found the correlation of 20 80.


When you deny science to allow you to retain failed ideas it is time to get new ideas.

Where is it written that some external force should intervene with an imbalance of the 80-20 rule?

 

[Truthmatters]

How does the 20 80 balence maintain its self?

The balence is what the mans data found exsisted at the time.

It was based on the real numbers of real countries of the time.


This was a natural pattern of thed balence of asset power to cause the people to revolt when their asset power became too small for them to secure a reasonable livelyhood for their families.

Force a man to be so poor as to not afford to keep his children well and alive and the guy will say "Im mad as hell and im not going to take it anymore".

They are willing to fight to the death for enough of the pie to have a life that is not filled with emotional and physical pain of poverty.


Where are we now in the balence ?

 

[asterism]

How does the 20 80 balence maintain its self?

The balence is what the mans data found exsisted at the time.

It was based on the real numbers of real countries of the time.


This was a natural pattern of thed balence of asset power to cause the people to revolt when their asset power became too small for them to secure a reasonable livelyhood for their families.

Force a man to be so poor as to not afford to keep his children well and alive and the guy will say "Im mad as hell and im not going to take it anymore".

They are willing to fight to the death for enough of the pie to have a life that is not filled with emotional and physical pain of poverty.


Where are we now in the balence ?

Pretty good since the poor here live better than the global average of all people. These calls for uprising aren't coming from poor people, they are coming from middle and upper class activists.

Compensation for workers is much better now than in the recent past:

 

[Truthmatters]

this is why you dont let the wealth concentrate in too few hands.

 

[Baruch Menachem]

Why did you necromance this four month dead thread to say exactly nothing?

 

[Si modo]

Why did you necromance this four month dead thread to say exactly nothing?

True, but she doesn't need to necromance a thread to say nothing.