Discuss the basic difference in approach adopted by pigou and pareto to deal with problems of welfare economics
Answers
Answered by
1
Pigou's approach
According to him welfare resides in a man's state of mind or consciousness that is made up of his utilities or satisfactions. So the basis of welfare is the extent to which an individual's desires are fulfilled. Pigou treated matter by definition in his economic approach to economic welfare.
Pareto's approach
Pareto's principle is also known as the 80 / 20 rule. According to it 80% of the output from a given situation or system is determined by 20% of the input. He subjected the redistribution of economic goods to analytical treatment in his sociological approach to social welfare maximization.
Similar questions