Full text: The Personal Distribution of Income

example, there is a probability of virtually infinite 
life.The steady state in these models is made possible 
only by the continuing new entry of small units. 
Further developments. 
Champernowne's work has inspired another model (Rutherford 
1955)in which personal age has been introduced 
explicitly.This still leaves important questions 
unanswered. Income is not a very suitable variable as the 
state of a Markov chain. It does not embody the influence 
of the past (Polya's "influence globale"),so that 
yesterdays state tells you all you need to know about the 
past. More important, the model is confined to the life 
cycle of an individual from entrance to exit. But the 
relevant stochastic process goes far beyond that.When 
somebody starts in life his chances of receiving certain 
incomes are already settled to a large extent by the 
condition of his parents:By their wealth,status, 
connections,reputation and the education or training they 
, , O , 
have been able to give him. In other words the entries 
and exits in the life cycle model are linked by 
inheritance and similar elements, and the stochastic 
process continues over the generations. 
The arguments point to an obvious conclusion: We must 
relate the chances of getting certain incomes to the

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