15
V\
or conditional distribution of income, therefore includes
MMft income here, The regression of property owners’ total
income on their wealth can be studied on the basis of
Dutch data '■ (fig. 5). The regression is linear, and homo-
scedastic; the correlation coefficient is 0,5* the re
gression coofficient is 0.G2Si0.004 (data for 1962/63).
Tho regression coefficient corresponds to our k, Shot
<1 can bo explained in the first place by the presumed
fact that with increasing wealth earned income is less
and loss important; in the second pi co perhaps by the
fact that income from shares which dominates for the
larger wealth does notjk ant a in the undistributed profits.
Since the Pareto coefficient for wealth was 1.38 in 1962/63*
we should expect it to be 2.20 for income on the basis of
the theory. In reality it was 2.03. A better correspondence
is hardly to be expected, since the wealth distribution at
that time has been distorted by the stock exchange boom
(see /l /). 2 )
A similar calculation with Swedish data gives very un
satisfactory results, although the regression line is
linear and homoscedastic. This may be explained by the
guosr: that the classification of income (which stops at
^ D* J
,.n .a.*
at *
1 >See / 1/
2)
Since the holding of shares increases strongly with the
^0 ^(T ^ , z-'t