The Pareto Principle, commonly known as the 80/20 rule, is a concept in economics and business that suggests that 80% of consequences come from 20% of the causes.
Named after Italian economist Vilfredo Pareto, who first observed that approximately 80% of the land in Italy was owned by 20% of the population, this principle has broad applications across various fields.
It highlights how most effects are driven by a relatively small number of causes, suggesting that focusing on these critical inputs can yield disproportionate benefits.
This principle encourages efficiency and prioritization in problem-solving, business strategy, time management, and resource allocation.
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