Paretoforbedring

Paretoforbedring, or Pareto improvement, is a change in the allocation of resources in an economy in which at least one person is made better off and no one is worse off compared with the initial allocation. It is a local, practical criterion for judging whether a change in policy, allocations, or exchanges should be considered an advance.

Pareto improvements are central to the idea of Pareto efficiency: if no further Pareto improvements are possible from a given allocation, that allocation is Pareto efficient (Pareto optimal). The existence of improvements does not imply a unique outcome; there may be many different Pareto improvements leading to different efficient allocations. The concept does not specify how benefits are distributed across individuals.

An example: two agents hold different bundles of goods. Through a voluntary trade or reassignment, it is possible to increase the utility of at least one agent without reducing the utility of the other. When such a change exists, it is a Pareto improvement; after the change, no further Pareto improvements may be possible, or additional improvements may still be possible.

Limitations include that Pareto improvements do not address equity or overall welfare comparisons across different outcomes; they depend on the initial allocation and on the individuals’ preferences. The concept also assumes perfect information and voluntary exchange in well-defined markets. It originated with Vilfredo Pareto and is widely used in welfare economics to analyze policy changes and efficiency claims. Pareto improvement is sometimes described as a Pareto superior change.