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How the Pareto Principle, a.k.a. 80/20 rule, came to rule the business world : The Indicator from Planet Money A favorite of productivity hackers, the Pareto Principle, aka the 80/20 rule, has taken on a life of its own since it was first observed by an Italian economist over a century ago. The concept states that a small number of causes generates a large number of outcomes. Today on the show, the origins of the Pareto Principle, why marketing and business-types love it, and whether it holds up under scrutiny.

For sponsor-free episodes of The Indicator from Planet Money, subscribe to Planet Money+ via Apple Podcasts or at plus.npr.org.

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The Indicator from Planet Money

Putting the 80/20 rule to the test

Putting the 80/20 rule to the test

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The 80/20 rule, also known as the Pareto Principle. (Julia Ritchey / NPR)
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Julia Ritchey/NPR
The 80/20 rule, also known as the Pareto Principle. (Julia Ritchey / NPR)
Julia Ritchey/NPR

A favorite of productivity hackers, the Pareto Principle, aka the 80/20 rule, has taken on a life of its own since it was first observed by an Italian economist over a century ago. The concept states that a small number of causes generates a large number of outcomes. Today on the show, the origins of the Pareto Principle, why marketing and business-types love it, and whether it holds up under scrutiny.

For sponsor-free episodes of The Indicator from Planet Money, subscribe to Planet Money+ via Apple Podcasts or at plus.npr.org.

Music by Drop Electric. Find us: TikTok, Instagram, Facebook, Newsletter.