Beyond Welfarism: Welfare Economics in Pareto's Treatise

Pareto’s contribution to the study of economic welfare is probably his most important contribution to economic science. The first theorem was invented by Vilfredo Pareto in 1906 and it was subsequently forgotten. Only after the Second World War it has been rediscovered, becoming the canonical tool of the welfare economics. In Pareto’s welfare theory it is not possible to find something similar to the second fundamental theorem of welfare. In this contribution I will explore essentially two aspects relatively unnoticed. The first is the relevance of the distinction operated by Pareto of the utility for the collectivity and of the collectivity in terms of social welfare. The second is the relationships of the welfare function proposed by Pareto with the subsequent evolution of the literature on this topic. We will see that the Pareto’s position is immune from some criticism of the welfarism, i.e., the typical assumption advanced by the economists.