Open AccessPareto’s Law As Structural Economic Synapse
Author(s) -
Alexandru Trifu
Publication year - 2012
Publication title -
journal of economics and behavioral studies
Language(s) - English
Resource type - Journals
ISSN - 2220-6140
DOI - 10.22610/jebs.v4i1.304
Subject(s) - pareto principle , productivity , welfare , sustainability , economics , order (exchange) , pareto distribution , distribution (mathematics) , microeconomics , market economy , operations management , macroeconomics , ecology , mathematical analysis , statistics , mathematics , finance , biology
Starting from the observations of Italian economist Vilfredo Pareto, in the early days of XX-th century, refering to personal income distribution, we are coming to understand that it is not enough heightens the wealth of a nations, so that collective welfare to increase. It requires that the wealth created to be equitably distributed and not equally. Today, the famous Paretian Principle 80/20 demonstrates that we must wisely use the resources (i.e. 20%), enhance productivity, competitiveness and sustainability of the entities on the markets, so as to maintain the favourable results in 80 % ratio, but also to be overcome. Due to the elements composing the concept of Pareto’s Law, but mainly to the practical use of the theoretical pattern of an ex-post nature, we consider it a true synapse within economics, in order to facilitate an well-functioning of the society and economy and to motivate a rising of productivity in all domains.