Pareto efficiency, or Pareto optimality, is an economic state where resources cannot be reallocated to make one individual better off without making at least one individual worse off. Pareto efficiency implies that resources are allocated in the most economically efficient manner, but does not imply equality or fairness. An economy is said to be in a Pareto optimum state when no economic changes can make one individual better off without making at least one other individual worse off.
Pareto efficiency, named after the Italian economist and political scientist Vilfredo Pareto (1848-1923), is a major pillar of welfare economics. Neoclassical economics, alongside the theoretical construct of perfect competition, is used as a benchmark to judge the efficiency of real markets—though neither perfectly efficient nor perfectly competitive markets occur outside of economic theory.
The combined effect of the Zimmerman telegram and renewed attacks on American shipping are seen by historians as the immediate catalysts for pushing the United States to war.
