Skip to main content

Pareto Efficient Allocations

Go Search
New Atlas
Atlas, A-Z
Atlas Maps
MPP/MPA Programs
Core Topics
Illustrative Courses
Topic Encyclopedia
Concept Dictionary
Career Tips
Best Practices Project

PPGPortal > Home > Concept Dictionary > P, Q > Pareto Efficient Allocations

Pareto Efficient Allocations

Any allocation of goods in which no trades are possible that would make both participants in the trade better off.

(Dwayne Benjamin, PPG 1002H)


The First Theorem of Welfare Economics states that in any market in which the free exchange of goods is permitted, the resulting allocation will be Pareto efficient.


Important Notices
© University of Toronto 2008
School of Public Policy and Governance