Decrease social welfare, A policy that results in a Pareto

Decrease social welfare

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Reference no: EM131424789

Clearly explain why the statement is false:

A policy that results in a Pareto improvement will always satisfy the Kaldor-Hicks Criterion; however, it may decrease social welfare. [A caveat for those who might overthink this: you may assume that we’re only considering social welfare functions that suggest we’re not actively seeking to harm anybody.]

Reference no: EM131424789

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