‘Legal Theory Lexicon: Efficiency, Pareto, and Kaldor-Hicks’

“Almost every law student receives some introduction to normative law and economics in their first year of law school. One of the basic ideas of normative law and economics is that the law should be ‘efficient’. But what does efficiency mean? For economists, ‘efficiency’ is a technical idea – with only a tangential connection to the use of ‘efficiency’ in ordinary speech. In order to understand economic efficiency, we will look at what are called the Pareto principles and a related idea that is sometimes called Kaldor-Hicks efficiency …” (more)

[Lawrence Solum, Legal Theory Blog, 17 May]

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