Pareto Optimal

An outcome that’s Pareto optimal is one where you can’t redistribute any resources without making things worse for someone. If you only need one water and have two more, which you share with your friends on the hike, that was nice of you...but not that nice of you, since it didn’t make you worse off to share. That wasn’t a Pareto optimal situation.

If you only had one water bottle and your friend asked for some water, well...that’s a Pareto optimal outcome. Even though your friend would be better off, you would be worse off, meaning the situation is Pareto optimal. Learn more about Pareto optimality under Pareto efficiency, and how it’s sometimes fair, and sometimes not at all. But isn't all fair in love and economics? Or something like that.

See: Pareto Efficiency.