Updated: Aug 20, 2021

The requirement that some of one good or one objective has to be given up to obtain more of another. The need to trade off goods or objectives against one another is a sign of economic efficiency; if it is possible to get more of one good without accepting less of another, or to achieve one objective without sacrificing another, the economy is not Pareto efficient.

Reference: Oxford Press Dictonary of Economics, 5th edt.

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James Knight
Editor of Education
James is the Editor of Education for Invezz, where he covers topics from across the financial world, from the stock market, to cryptocurrency, to macroeconomic markets.... read more.