Samuelsons Criteria:
A way out of Gorman's intransitivity problem has been proposed by Paul Samuelson, popularly known as the Samuelson Criteria. The Samuelson criteria argues that a situation G is preferred to a situation D if all hypothetical redistributions from situation G will achieve utility allocations that are superior to some hypothetical redistributions from situation D and that no
hypothetical redistribution from situation D will yield utility allocations that are unattainable through any hypothetical redistributions from situation G. in other words, the utility space lies everywhere above UPFD. In production space, it requires that PPFG intersects the interiors of CICD and the interior of any other CIC tangent to PPFD. Clearly, this will often require that PPFG lies
everywhere above PPFD - as in Figure . Naturally, if we deal exclusively with PPFs of this type, neither Scitovsky reversals nor Gorman intransitivities arise. But it also obviously highly restrictive as it rules out quite reasonable situations . Thus, in this sense, the Samuelson criterion is far more restrictive than the Kaldor, Hicks or Scitovsky double criteria.