 Inefficiency in game theory

In game theory, inefficiency typically refers to a situation where resources are not allocated in the most effective way possible, leading to a loss of potential value or utility. This can occur in various forms, such as: 1. **Pareto Inefficiency**: A situation is said to be Pareto inefficient if there exists at least one alternative allocation of resources that would make at least one player better off without making any other player worse off.