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'''Vilfredo Pareto''' (1848-1923) was an Italian sociologist and [[economist]] responsible for several mathematical insights, particularly for economic equilibriums.  He is credited with the work underlying indifference curves, and proved that a theory of demand did not depend on utility.  As a sociologist he is best known known for his analysis of elites and his statistical studies of inequality.  He opposed Marxism and socialism and his ideas were widely admired by conservatives.

'''Vilfredo Pareto''' (1848-1923) was an [[Italian]] sociologist and [[economist]] responsible for several mathematical insights, particularly for economic equilibriums.  He is credited with the work underlying indifference curves, and proved that a theory of demand did not depend on utility.  As a sociologist he is best known known for his analysis of elites and his statistical studies of inequality.  He opposed Marxism and socialism and his ideas were widely admired by conservatives.

==Career==

==Career==

Pareto was born in Paris, France, July 15, 1848. Son of an aristocratic Genoese engineer living in exile and a Frenchwoman, he returned to Italy with his parents in 1858. After attending the Reale Politecnico until 1869, he became a railway executive and rose rapidly to a place as a director of Ferrovie Italiane.  When [[Leon Walras]] retired as professor of  

Pareto was born in Paris, France, July 15, 1848. Son of an aristocratic Genovese engineer living in exile and a Frenchwoman, he returned to Italy with his parents in 1858. After attending the Reale Politecnico until 1869, he became a railway executive and rose rapidly to a place as a director of Ferrovie Italiane.  When [[Leon Walras]] retired as professor of  

economics at Lausanne University, Switzerland, in 1893, Pareto was chosen his successor. Italian dictator [[Benito Mussolini]] was impressed by Pareto's theories, named him a delegate to the Geneva Disarmament Conference (an honor Pareto refused) and conferred on him the title of Senator of the Kingdom of Italy (1922). His death soon after the ascendancy of Mussolini left it unclear whether or not he supported or rejected Fascism. His open advocacy of force may have lent support to the Fascist regime, but he also insisted on a libertarian economic system free from political restraints.

economics at Lausanne University, [[Switzerland]], in 1893, Pareto was chosen his successor. Italian dictator [[Benito Mussolini]] was impressed by Pareto's theories, named him a delegate to the Geneva Disarmament Conference (an honor Pareto refused) and conferred on him the title of Senator of the Kingdom of Italy (1922). His death soon after the ascendancy of Mussolini left it unclear whether or not he supported or rejected Fascism. His open advocacy of force may have lent support to the Fascist regime, but he also insisted on a libertarian economic system free from political restraints.

==Economics==

==Economics==

Pareto's turned his interest to economic matters and he became an advocate of free trade, finding himself in difficulty with the Italian government. His writings reflected the ideas of [[Leon Walras]] that economics is essentially a mathematical science. Pareto was a leaders of the "Lausanne School" represents the second generation of the Neoclassical revolution.  His "tastes-and-obstacles" approach to general equilibrium theory were resurrected during the great "Paretian Revival" of the 1930s and have influenced theoretical economics since.  

Pareto's turned his interest to economic matters and he became an advocate of free trade, finding himself in difficulty with the Italian government. His writings reflected the ideas of [[Leon Walras]] that economics is essentially a mathematical science. Pareto was a leaders of the "Lausanne School" represents the second generation of the Neoclassical revolution.  His "tastes-and-obstacles" approach to general equilibrium theory were resurrected during the great "Paretian Revival" of the 1930s and have influenced theoretical economics since.  

In his ''Manual of Political Economy'' (1906) the focus is on equilibrium in terms of solutions to individual problems of "objectives and contraints".  He used the indifference curve of Edgeworth (1881) extensively, for the theory of the consumer and, another great novelty, in his theory of the producer.  He gave the first presentation of the trade-off box now known asthe "Edgeworth-Bowley" box.  

In his ''Manual of Political Economy'' (1906) the focus is on equilibrium in terms of solutions to individual problems of "objectives and constraints".  He used the indifference curve of Edgeworth (1881) extensively, for the theory of the consumer and, another great novelty, in his theory of the producer.  He gave the first presentation of the trade-off box now known as the "Edgeworth-Bowley" box.  

Pareto realized that cardinal utility could be dispensed with--that is, it was not necessary to know how much a person valued this or that, only that he preferred X of this to Y of that. Utility was a preference-ordering.  With this, Pareto not only inaugurated modern microeconomics, but he also demolished the alliance of economics and utilitarian philosophy (which calls for the greatest good for the greatest number; Pareto said "good" cannot be measured).  He replaced it with the notion of ''Pareto-optimality'', the idea that a system is enjoying maximum economic satisfaction when no one can be made better off without making someone else worse off.  Pareto optimality is widely used in welfare economics and game theory. A standard theorem is that a perfectly competitive markets create distributions of wealth that are Pareto optimal.

Pareto realized that cardinal utility could be dispensed with--that is, it was not necessary to know how much a person valued this or that, only that he preferred X of this to Y of that. Utility was a preference-ordering.  With this, Pareto not only inaugurated modern microeconomics, but he also demolished the alliance of economics and utilitarian philosophy (which calls for the greatest good for the greatest number; Pareto said "good" cannot be measured).  He replaced it with the notion of ''Pareto-optimality'', the idea that a system is enjoying maximum economic satisfaction when no one can be made better off without making someone else worse off.  Pareto optimality is widely used in welfare economics and game theory. A standard theorem is that a perfectly competitive markets create distributions of wealth that are Pareto optimal.

==Inequality==

==Inequality==

An important contribution still in use was his "Pareto's Law" of income distribution.  He argued that in all countries and times, the distribution of income and wealth is highly skewed, with a few holding most of the wealth.  He argued that all obsaerved societies follow a regular logarithmic pattern:

An important contribution still in use was his "Pareto's Law" of income distribution.  He argued that in all countries and times, the distribution of income and wealth is highly skewed, with a few holding most of the wealth.  He argued that all observed societies follow a regular logarithmic pattern:

#    log N = log A + m log x  

#    log N = log A + m log x  

where where N is the number of people with wealth higher than x, and A and m are constants.  Over the years, Pareto's Law has proved remarkably close to observed data.  

where where N is the number of people with wealth higher than x, and A and m are constants.  Over the years, Pareto's Law has proved remarkably close to observed data.