Vilfredo Pareto


Also found in: Dictionary, Thesaurus, Financial, Wikipedia.

Pareto, Vilfredo

 

Born July 15, 1848, in Paris; died Aug. 20, 1923, in Céligny, near Geneva. Italian economist and sociologist.

A representative of the mathematical school in bourgeois political economy, Pareto studied mathematics and engineering at the University of Turin and worked as an engineer for the Italian railroads; later he taught economic logic. From 1893 to 1906 he was a professor of political economy at the University of Lausanne.

Pareto rejected monistic theories of causation in the social sciences, asserting that sociology and political economy explain the functional interdependence of equivalent social phenomena. He viewed society as a system that, like a mechanical system, is in equilibrium as a result of the mutually restraining and antagonistic interests of various strata and classes. He believed that social development is determined by people’s actions, which may be either logical (goal-oriented) or nonlogical (unconscious). Nonlogical actions are based on a combination of what Pareto called residues, that is, instincts, desires, and interests present in man since time immemorial. As a creature of faith and feeling, man is also accorded a need for a logical or, more accurately, pseudological, ex post facto justification for his irrational conduct. Therefore, each nonlogical act also contains variable interpretations of the residues. These interpretations, which Pareto called derivations, explain and at the same time conceal the residues. As they spread among the masses, these derivations may, in Pareto’s opinion, reach the level of ideologies, religious teachings, and philosophic theories.

Combinations of residues and derivations define a particular social process, while their uneven distribution among people contributes to social inequality and social antagonisms. This artificial, unscientific scheme lay at the root of Pareto’s explanation of the mechanism of social life. Creative force, struggle, and change by the small elite with the aid of coercion are, in Pareto’s opinion, the moving forces and the law of society.

Pareto believed that political economy should study the mechanism that establishes the balance between peoples’ needs and the limited means for their satisfaction. He considered mathematical analysis a necessity in the study of this balance. He strove to provide a theoretical explanation for the concept of the interdependence of all economic factors, including prices. Pareto sought to refine the theory of general economic equilibrium advanced by L. Walras. In distinction to the latter, he examined a number of equilibrium conditions over time and also allowed the coefficients of the production function to vary with production output. Pareto’s law on the distribution of incomes has become widely known. Pareto also studied problems related to economic crises, rents, money, and interest rates.

Pareto was hostile to Marxism and the revolutionary movement. His rejection likewise of the ideals of bourgeois democracy was later seized upon by the ideologists of Italian fascism, although Pareto himself was hostile to fascism.

WORKS

Oeuvres complètes, vols. 1–13. Geneva, 1964–70.
Cours d’économie politique, vols. 1–2. Lausanne-Paris, 1896–97.
Trattato di sociologia generale, vols. 1–2. Florence, 1916.

REFERENCES

Bliumin, I. G. Kritika burzhuaznoi politicheskoi ekonomii, vol. 1. Moscow, 1962.
Becker, H., and A. Boskoff. Sovremennaia sotsiologicheskaia teoriia. Moscow, 1961. (Translated from English.)
Seligman, B. Osnovnye techeniia sovremennoi ekonomicheskoi mysli. Moscow, 1968. (Translated from English.)
Roll, E. A History of Economic Thought, 3rd ed. Englewood Cliffs, [N. J.,] 1956.
Schumpeter, J. A. Ten Great Economists: From Marx to Keynes. New York, 1965.

I. S. DOBRONRAVOV and I. T. LASHCHINSKII

References in periodicals archive ?
Accepting the idea of the class struggle promoted by Marx, Vilfredo Pareto argues that it is not only a a simple struggle between the proletariat and capitalists, but "we find it in an infinity of groups with different interests and, especially, among elites disputing power".
Vilfredo Pareto, Trattato di Sociologia Generale (Florence: G.
Vilfredo Pareto, The Rise and Fall of the Elites (Totowa, New Jersey: The Bedminster Press, 1968), p.
As the Italian economist Vilfredo Pareto observed in coining the so-called 80/20 principle, "The first 20% of effort often contributes 80% of the benefit.
The 80/20 rule was first proposed by Vilfredo Pareto, an Italian economist, in 1895.
The concept of optimum commonly adopted in multi-objective optimization is the one proposed by Vilfredo Pareto in 1986 (and called Pareto optimality).
The company says its name comes from a theory by an Italian economist, Vilfredo Pareto, who judged that 80 percent of one's results come from 20 percent of one's efforts.
Fue Vilfredo Pareto el que en un ensayo clasico, formulo un conjunto de axiomas relacionadas con la desigualdad fisica, intelectual y moral de las personas.
He revered imaginative literature (Dante remained a lifelong favourite) and also venerated sociology; during his years as a day-labourer in Switzerland he attended public lectures by Vilfredo Pareto, and he lost count of the number of times he had read Gustave Le Bon's Psychology of the Crowd.
Vilfredo Pareto, an Italian economist of the late 19th century, noticed that in the countries that he observed, 80 percent of the wealth of the nations was owned by 20 percent of the people.