Introduction. Efficiency is generally regarded as a value-neutral concept, concerned with assessing whether an economy produces at its possibility frontier, that is, generating maximum possible market output with given resources. Efficiency analysis generally rejects concerns with distribution – often referred to as equity – which leads to the common understanding of efficiency and equity as being trade-offs. This is also the comprehension of the widely applied Pareto efficiency criterion. The efficiency/equity trade-off reflects the strong influence of positivism on economics, whereby efficiency is regarded as located on the ‘positive’ side of economic science, and equity – as expressed by social welfare functions, rights, equality of liberty, or other distributive concepts – on the ‘normative’ side (Putnam and Walsh, 2007)

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Series ISS Staff Group 3: Human Resources and Local Development
Note SCEME Working Paper No. 18, 2007
van Staveren, I.P. (2007). The ethics of efficiency (No. 1756-2031). ISS Staff Group 3: Human Resources and Local Development. Retrieved from