What is Kaldor-Hicks efficiency?
[[Image:Kaldor-Hicks-en.svg|thumb|right|280px|Pareto improvements are a small subset of Kaldor–Hicks improvements.]] '''Kaldor–Hicks efficiency''', named for [[Nicholas Kaldor]] and [[John Hicks]], also known as '''Kaldor–Hicks criterion''', is a measure of [[economic efficiency]]. It captures some of the [[wikt:intuitive|intuitive]] appeal of [[Pareto efficiency]], but has less [[wikt:stringent|stringent]] criteria. For this reason, it is applicable more often. Under Kaldor–Hicks efficiency, an outcome is considered more efficient if a Pareto optimal outcome can be reached by arranging sufficient compensation from those that are made better off to those that are made worse off so that all would end up no worse off than before. {{science-stub}} [[Category:Welfare economics]] [[Category:Economic indicators]]