Archive for April 4th, 2011

April 4, 2011

Don’t try and make things better

by James Thorniley

I think sometimes we’re too obsessed with optimisation. It’s a product of the industrial revolution, or something, everything can go faster, better and cheaper, we assume, except that we all know it can’t. You have to make compromises, obviously. In economics and engineering, the problem is referred to as Pareto optimality. Basically, if you can’t make something better in one respect without making it worse in another, it is Pareto optimal. A “Pareto improvement”, is a change that achieves what you want: making things better without making anything else worse, a change with no compromise. Policy makers know this (it is not an obscure theory) and are supposed to try and achieve Pareto improvements with the changes they make. The thing is, in a complex environment, getting a genuine Pareto improvement is, I suspect, almost certainly impossible.


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