Full text: The Personal Distribution of Income

The conditional distributions have all Pareto tails although the 
fit is bad ( only 4 values can be used ). The Pareto coefficient 
is between 3 and 4 la all except the last two wealth classes, 
where it is very low, and it is 2,68 for the whole income distribution. 
It appears that the inc >me distribution as a whole is - 
as far a3 its tail is concerned - decisively influenced by the 
last two wealth classes. This is due t the fact that n st 
of the t >p inc ne receivers are in the last iw wealth classes, 
where the inc me diotributi n is very unequal simply owing 
to the wide range f wealth in these two classes, as already 
menti nod bef re In this way the oeculiar result arises that 
the t tal inc me distributi n is much ra^re unequal than 
almost all the conditional inc me distributions. 
This in a way also answers the quest! n which 
might well be aakeds ;hy the pattern of inc me diotributi n 
c>uld not be derived fr m the conditional distributions 
without reference to the wealth distribution. 
Allometric growth of income and wealth 
The discussion of the relatione of income and wealth will 
now be extended t take accoun^of influences in both direc i&ns. 
The starting point will be the regression of income 
on wealth which seems to be linear as far as the data go. 
This might be regarded as a case of allnmetry, in anal gy to 
a ''law” well known to biologists 1 t Various parts of an organism 
grow at different but constant rates and as a result the pr portion 
of their sizes ( on log scale ) remain constant in the growing body. 
1 ) Ludwig v -n -^ortalanffy, feneral System The >ry Penguin 19^8 p.63 
Devendra Sahal has used the aTT~metric law in combination with 
the progress funoti>n in order t- explain the Paret distributi) n 
( in ne dime .si n ); see A F naulati n f the Paret' Distributi n. 
US.!, Science ^ontre, 10 0 Berlin 33( mime > ). ■Ala-*- Although the 
use I am trying to male f the law is different I owe t 
Devendra Sah.nl 1o have my attention drawn to it.

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