In welfare economics, a social planner is a decision-maker who attempts to achieve the best result for all parties involved. In neo-classical welfare economics, this means the maximization of a social welfare function. In modern welfare economics, there is a greater emphasis on Pareto optimality, in which no one's economic status can be improved without worsening someone else's. Pareto-optimal solutions are not unique, and according to the Second Fundamental Theorem of Welfare Economics, a social planner can achieve any Pareto-optimal outcome by an appropriate redistribution of wealth by means of competitive market.
In practice, the social planner role is generally played by a government entity. However, real governments have multiple goals in addition to, or instead of the benefit of their people. This problem is studied in public choice economics.
Famous quotes containing the word social:
“The things women find rewarding about work are, by and large ,the same things that men find rewarding and include both the inherent nature of the work and the social relationships.”
—Grace Baruch (20th century)