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((more citations needed|date=March 2010))
The '''Scitovsky paradox''' is a paradox in [[welfare economics]] which is resolved by stating that there is no increase in [[social welfare]] by a return to the original part of the losers. It is named after the [[Hungary|Hungarian]] born [[United States|American]] [[economist]], [[Tibor Scitovsky]].

According to Scitovsky, [[Kaldor-Hicks|Kaldor-Hicks criterion]] involves contradictory and inconsistent results. What Scitovsky demonstrated was it is possible that if an allocation A is deemed superior to another allocation B by the [[Kaldor compensation criteria]], then by a subsequent set of moves by the same criteria, we can prove that B is also superior to A.

The paradox occurs when the gainer from the change of allocation A to allocation B can compensate the loser for making the change, but the loser could also then compensate the gainer for going back to the original position. Scitovsky pointed out that to get at the correct criterion of welfare we must remove this contradiction. He has therefore offered his own criterion called the “Scitovsky Double criterion”.<ref>((Cite web|url=http://www.economicsdiscussion.net/welfare-economics/compensation-principle-of-kaldor-hicks-and-scitovsky/21050|title=Compensation Principle of Kaldor, Hicks and Scitovsky|date=2016-05-23|website=Economics Discussion|language=en-US|access-date=2019-06-23))</ref>

The Scitovsky criterion was developed by Tibor Scitovsky in his paper “A Note on Welfare Propositions in Economics”, 1941.<ref>((Cite book|last=Scitovsky|first=Tibor|date=2013-04-15|title=Papers on Welfare and Growth|doi=10.4324/9780203708583|isbn=9780203708583))</ref>

== Further reading ==
* ((cite book |last=Scitovsky |title=The Joyless Economy: An Inquiry into Human Satisfaction and Consumer Dissatisfaction |location=Oxford |year=1976 |isbn=0-19-507347-9 |url=((Google books |plainurl=yes |id=l-rDAAAAIAAJ |page= )) ))

((Economic paradoxes))

==References==
((Reflist))

((DEFAULTSORT:Scitovsky Paradox))
[[Category:Welfare economics]]
[[Category:Microeconomic theories]]
[[Category:Paradoxes in economics]]


((Econ-theory-stub))

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