20
(11)
q»‘*(y) - q*»(w) * f (K w - y )
Row can this series of transf rmati ms square
an as to produce a steady state of the joint distribution?
2 0 explain this we have t separate income at least theoretically
into earned and unearned income, ^he distribution of earned
inc me has to be regarded as given from outside; its explanation
has to be sught separately; empirically at any rate it s
a Pareto distribution. It may be regarded as constant in the
simplest case. Prom it flows the continuing primary a -cumulation
which contributes to the accumulation of existing wealth holders
and also creates new wealth holders ( a kind of social mobility ).
This wealth then creates property income and secundary accumulation.
The process leads from a relatively moderate inquall ty of
earned income to more unequal primary wealth, and even more
unequal secundary wealth.
*n this way wa can imagine that total income
and total vzealth will grow at constant rates. The corresponding
alloiuetric proportion does not appear directly in the cross-section
where instead appear the two regression lines which are neither
of them a reliable estimate of the ratio of the two Fardto coefficients.
Can this be regarded ad the reason why the attempt
at empirical verification of equation (8‘) on the basis of Swedish
and ^vfcsh data lead to unsatisfactory results?