5 this approach, size distribution is a transformed age distribution, and the pattern of the Pareto law appears* so often simply because of the empirical importance of exponential growth which makes both the age distribution and the tranformation function exponential. Owing to the conceptual density of Champernowne's model the two elements of life- cycle and promotion are merged into one. (which resides There is, however, a difference^in the interpretation not in the form) between Champernowne's model and the others: Since physical persons sooner or later die, the age in his model is limited, while in the others (relating to firms or wealth) there is always the probability of virtually infinite life which accounts for a very 2.2, peculiar character of the steady states concerned 7• Further developments We may consider the following stages in the treatment of the income distribution: I. Champernowne's model. ^ II. Rutherford's model C'ytl* He treated persons'life- times explicitly. III. The above models are open to criticism on two grounds: First, income is not very suitable as a state variable for a Markov process. It does not embody the "influence