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Pareto efficiency is a useful concept I like to think about. It often comes up when you compare items on multiple dimensions. Say you want to buy a new TV. To simplify it let’s assume you only care about two factors: price and quality. We don’t know what you are willing to pay for quality – but we know that everything else equals: The cheaper the better. The higher quality the better. This means we can rule out some TV’s immediately. If TV number 1 is both cheaper and better quality than TV nu...