Vilfredo Pareto
An Italian economist and sociologist, known
for his application of mathematics to economic analysis and for his theory of
the 'circulation of elites'.
Born in 1848, the son of a Genoese father and
a French mother, Pareto studied engineering at the University of Turin. The
five-year course in civil engineering, the first two years of which were
devoted to mathematics, deeply influenced Pareto's future intellectual outlook.
In 1870 he graduated with a thesis on "The Fundamental Principles of
Equilibrium in Solid Bodies." His later interest in equilibrium analysis
in economics and sociology is prefigured in this thesis. From 1870 until 1893
he worked as an engineer (like his father). Residing in Florence, he studied
philosophy and politics and wrote many periodical articles in which he was one
of the first to analyse economic problems with mathematical tools. In 1893 he
was chosen to succeed Léon Walras in the chair of political economy at the
University of Lausanne, Switzerland. He died in 1923 in Geneva.
Pareto's first work, Cours d'economie
politique (1896-97), included his famous 'law' of income distribution, a
complicated mathematical formulation in which he attempted to prove that the
distribution of incomes and wealth in society is not random and that a consistent
pattern appears throughout history, in all parts of the world and in all
societies.
In his Manuale di economia politica
(1906) and Manuale d'economie politique (1909 - a translation of the
preceding item but with a completely redone mathematical appendix) he further
developed his theory of pure economics. In this book he laid the foundation of
modern welfare economics with his concept of the so-called Pareto optimum,
stating that the optimum allocation of the resources of a society is not attained
so long as it is possible to make at least one individual better off in his own
estimation while keeping others as well off as before in their own estimation.
His most important sociological writings
dealt with his theory of the 'circulation of elites'. Pareto wrote a sociology
of the political process in which history consists essentially of a succession
of elites whereby those with superior ability in the prevailing lower strata at
any time challenge, and eventually overcome, the existing elite in the topmost
stratum and replace them as the ruling minority. In Pareto's view, this pattern
is repeated over and over again.
WWW References
Fittingly, there is a Pareto Home Page at the
Centre d'Etudes Interdisciplinaires Walras-Pareto at the Université de
Lausanne. It includes a biography of Pareto (in French).
Some information on Vilfredo Pareto can also
be found here.
Other References
J Schumpeter, Ten Great Economists:
London, George Allen and Unwin, 1952, pp. 110 - 142. [An excellent piece.]
G. Busino, "Pareto, Vilfredo", in The
New Palgrave, A Dictionary of Economics,1987, Volume 3, pp. 799-804.
J Schumpeter, History of Economic Analysis:
London, George Allen and Unwin, 1954, pp. 859 - 61.
Acknowledgment
The picture of Pareto is presented here with
permission from the Centre d'Etudes Interdisciplinaires Walras-Pareto at the
Université de Lausanne.
(c) Department of Economics, University of
Melbourne
Created: Last modified: 20 June 2000