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The condition in which the economy is producing what people want at least possible cost pareto efficiency; pareto optimality A condition in which no change is possible that will make some members of society better off w/o making some other members of society worse off. pareto efficient change makes at least one party better off and no party worse off.
300 BERNHEIM AND RAY To is simply the set of Nash equilibria in the one-shot game. Next, define the consistent equilibrium set @O as $* E To such that for all $J E To, for some i. @O is simply the weak Pareto frontier of the Nash set.