Full text: The Personal Distribution of Income

Footnotes to p.4 
1) Although Champernowne r 's.. theory is more complicated, than the 
' - * " t - * „ . r T , 
■simple'model which takes its place in the above-reasoning, 
we. can easily extend the conclusionsWith Shampernowne,. the- ' 
.. - promotion, is stochastic.,, with, probabilities'of' non-promotion 
and demotion*. In. this more general case p in. the above solution 
■ l has. to be replaced by 'b_ which is the.' root of the characteristic 
equation of the ' 
- ‘ - S* - ' - i ■' ' - . : Tn n ' ' 
,'WThe Pareto, coefficient in the simple case is —■£—*- 
, the ratio 
of the. parameters of the- twcr exponential distributions In the 
more'general case, ofChampernowne the Pareto: coefficient'is- 
ii-— * b could be regarded as . the'parameter of an age dis 
tribution, if the classes; (states of the system.) are regarded 
Its.: age- classes: T *> *U ** - tU 
, : " o<r Aiir- 
2). Champernowne- .apparently did nor know Yulefs. paperr-It was 
- - ./&.Simon.’ s merit- to'have .brought it. to the. attention - of 
i economists p unfortunately he reproduced it; In a form which 
:he- interplay of the two ex— 
of two stochastic Drocesses- 
obscured Its essence* which is 
ponentxal dxstrxbutxons,_ x.e'

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