By: Nadia Al-Sakkaf

Economists call policies where no one can be made better off without making someone else worse off “Pareto efficient.” The expression is named after late 19th century Italian economist Vilfredo Pareto who used the concept in his studies on economic efficiency and income distribution.

Developing countries are often advised (or instructed) to undertake reforms recommended by “experts” who are called “technocrats” and are often backed by the IMF. Economics professor and bestselling author Joseph E. Stiglitz argues that sometimes there are policies that can promote both growth and equality, and the job of good economists is to search for them. The problem is that many policies advanced by technocrats as if they were Pareto efficient are in fact flawed and make many people – sometimes entire countries – worse off.
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