Economics · Welfare Economics
The Kaldor-Hicks compensation criterion states that a economic policy change represents a welfare improvement if:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The Pareto frontier remains unchanged
- 2Gainers can potentially compensate losers and still remain better off✓
- 3Losers are actually compensated by gainers
- 4All individuals gain from the change
Correct answer
Gainers can potentially compensate losers and still remain better off
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