In his efforts to highlight those aspects of a social system that are notamenable to economic investigation and hence require complementary analysison a specifically sociological plane, Pareto was led to make the key distinctionbetween the maximum utility of and the maximum utility for a community.The latter is the point where each individual has attained the maximum pos-sible private satisfaction. The former refers to the maximum utility of thegroup or society as a whole, not of individuals. Only the second type can betreated by the economist; he can consider only the wants of individuals whoare dissimilar and whose satisfactions therefore cannot be added up to yielda measure of the maximum utility for the entire group or society. "In pureeconomics a community cannot be regarded as a person." In contrast, insociology, Pareto argues, "[A community] can be considered, if not as a per-son, at least as a unity.'' The maximum utility to a society can be analyzedsociologically, and may not necessarily coincide with the maximum satisfactionof the wants of its individual members. What is more, there may well existdivergencies between utilities accruing to a total social system and maximumsatisfactions of sub-groupings, such as social classes. For example, in regard toan increase in population, the utility of the community and the utility for thecommunity may well diverge.
If we think of the utility of the community as regards prestige and mili-tary power, we will find it advisable to increase population to the fairly highlimit beyond which the nation would be diminished and its stock decay. Butif we think of the maximum utility for the community, we find a limit thatis much lower. Then we have to see in what proportions the various socialclasses profit by the increase in prestige and military power, and in whatdifferent proportion they pay for their particular sacrifices.
According to Pareto, the distinction between utility of and utility for acommunity is often deliberately obfuscated for manipulative purposes by rulinggroups who make it appear as if subject individuals or sub-groups wouldbenefit from certain measures when this is in fact by no means the case.
The ruling classes oftentimes show a confusion of a problem of maximumutility of the community and a problem of maximum utility for the com-munity. They [try] to make the "subject" classes believe that there is an in-direct utility which, when properly taken into account, turns the sacrifice re-quired of them into a gain. . . . In reality, in cases such as these, nonlogicalimpulse can serve to induce the subject classes to forget the maximum ofindividual utility, and work for the maximum utility of the community, ormerely of the ruling classes.
Or, to give another example, maximum wealth may be considered a primegoal for the society as a whole, but this may not coincide with the satisfactionof some of its members and may create great inequalities and major pocketsof poverty in the society. Inversely, a state in which the greatest number ofindividuals attain the maximum of satisfaction may mark a point of societaldecay and national decline.
By making his distinction between the utility for and the utility of a com-munity, Pareto moved from classical liberal economics, where it was assumedthat total benefits for a community simply involved a sum total of the benefitsderived by each individual member ("the greatest happiness of the greatestnumber"), to a sociological point of view in which society is treated as a totalunit and sub-groups or individuals are considered from the viewpoint of theircontribution to the overall system as well as in terms of their peculiar wantsand desires. System needs and individual or sub-group needs are distinguished.
It must be stressed that what is considered to be of maximum utility tosociety as a whole in fact involves subjective judgments rather than objectiveassessments. Those who run the affairs of the society, the governing elite, willdetermine what benefits the society as a whole needs, and they will decide thisin terms of their own interests, desires, values, and beliefs.
Pareto's thought converged with that of Durkheim. Both rejected utilitarianand individualistic notions and stressed the need to consider the requirementsof social systems, qua systems. They diverged, however, insofar as Durkheimbelieved that system needs could be determined objectively and scientifically,whereas Pareto contended that judgments of such needs derived from the de-sires and propensities, as well as the values and norms of those who were incommand.
From Coser, 1977:400-401.