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Distribution-neutral Welfare Ranking-Extending Pareto Principle

Sugata Marjit and Sandip Sarkar

No 6397, CESifo Working Paper Series from CESifo Group Munich

Abstract: The well known Pareto criterion used in the context of efficiency and welfare has to do with absolute changes whereas in every domain of economic behaviour inequality or relative changes has become a major concern. We propose an inequality-preserving or distribution neutral Pareto criterion-the strong Pareto superior or SPS allocation which preserves the initial distribution and makes everyone better off. Our main result is that whenever there is a gain in the aggregate value of the relevant attribute, there exists a unique counterfactual allocation which is SPS.

Keywords: Pareto superiority; strong Pareto superiority; inequality (search for similar items in EconPapers)
JEL-codes: A10 (search for similar items in EconPapers)
Date: 2017
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Related works:
Working Paper: Distributional Neutral Welfare Ranking-Extending Pareto Principle (2016) Downloads
Working Paper: Distributional Neutral Welfare Ranking-Extending Pareto Principle (2016) Downloads
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