A study of the personal income distribution in Australia

Banerjee, Anand; Yakovenko, Victor M.; Matteo, Tiziana Di

doi:10.1016/j.physa.2006.04.023

Cited by 86 publications

(69 citation statements)

References 13 publications

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“…(19), with the empirical data for the whole income range. However, the analytical form of this theoretical complementary cumulative distribution function is unknown in the closed explicit form.…”

Section: Resultsmentioning

confidence: 99%

“…Apparently, the number of free (effective) parameters driving the two-branch distribution function, Eq. (19), is reduced because this function depends only on the ratio of the initial parameters defining the Langevin dynamics (1).…”

Section: Our Extensionmentioning

confidence: 99%

“…Pareto's economic discoveries initiated attempts of analytical descriptions of incomes of the societies and inspired an avalanche of related research works [2,3,[5][6][7][10][11][12][13][14][15][16][17][18][19][20][21][22][23][24]. Among them, particularly significant are those of the economist Robert Gibrat [7,10,11].…”

Section: Introductionmentioning

confidence: 99%

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Modelling of income distribution in the European Union with the Fokker–Planck equation

Jagielski

Kutner

2013

Physica A: Statistical Mechanics and its Applications

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Herein, we applied statistical physics to study incomes of three (low-, mediumand high-income) society classes instead of the two (low-and medium-income) classes studied so far. In the frame of the threshold nonlinear Langevin dynamics and its threshold Fokker-Planck counterpart, we derived a unified formula for description of income of all society classes, by way of example, of those of the European Union in year 2006 and 2008. Hence, the formula is more general than the well known that of Yakovenko et al. That is, our formula well describes not only two regions but simultaneously the third region in the plot of the complementary cumulative distribution function vs. an annual household income. Furthermore, the known stylised facts concerning this income are well described by our formula. Namely, the formula provides the Boltzmann-Gibbs income distribution function for the low-income society class and the weak Pareto law for the medium-income society class, as expected. Importantly, it predicts (to satisfactory approximation) the Zipf law for the high-income society class. Moreover, the region of medium-income society class is now distinctly reduced because the bottom of high-income society class is distinctly lowered. This reduction made, in fact, the mediumincome society class an intermediate-income society class.

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Section: Resultsmentioning

confidence: 99%

Section: Our Extensionmentioning

confidence: 99%

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Modelling of income distribution in the European Union with the Fokker–Planck equation

Jagielski

Kutner

2013

Physica A: Statistical Mechanics and its Applications

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“…In addition, the PDFs analyzed seem to be quite complicated when compared to the Fréchet distribution equation. Therefore, in the present work the authors have followed the suggestion by Banerjee et al (2006), who stated 'that a useful description of the data is the one that has the minimal number of parameters, yet reasonably (but not necessarily perfectly) agrees with the data'.…”

Section: Introductionmentioning

confidence: 85%

Fréchet Distribution Applied to Salary Incomes in Spain from 1999 to 2014. An Engineering Approach to Changes in Salaries’ Distribution

Pindado

Cubas

2017

Economies

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Abstract:The official data in relation to salaries paid in Spain from 1999 to 2014 has been analyzed. The inadequate data format does not reflect the whole salary distribution. Fréchet distributions have been fitted to the data. This simple distribution has similar accuracy in relation to the data when compared to other distributions (Log-Normal, Gamma, Dagum, GB2). Analysis of the data through the fitted Fréchet distributions reveals a tendency towards more balanced (i.e., less skewed) salary distributions from 2002 to 2014 in Spain.Keywords: Spanish economy; salary distribution; parametric modelling; Fréchet distribution; minimum wage JEL Classification: C22; J31 IntroductionIn November 2015, the salary distribution data in Spain was updated in the statistics database of the Spanish Tax Agency. 1 This data is organized by taking into account several aspects of the Spanish society (gender, age, economic sectors, etc.). According to the best-selling newspaper in Spain, 2 the most significant information was the salaries earned in relation to the salary brackets (see in Tables 1 and 2 the number of salaried people and its weight in terms of total amount of paid euros, in relation to the salary, expressed in times the minimum wage), which demonstrates that the average annual salary in Spain fell in 2014 to the levels of 2007. Other key information from the statistics reflected in the media was the imbalance between genders. Men account for 82% of highest salaries in Spain, says new report (Jiménez 2015b).

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“…Because the cumulative income distribution is normalized to one, the function must be zero at μ n , in order to fulfil Eq. (14). Hence, we can approximate the function close to μ n by a Taylor expansion.…”

mentioning

confidence: 99%

Evolutionary model of the growth and size of firms

Kaldasch

2012

Physica A: Statistical Mechanics and its Applications

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The key idea of this model is that firms are the result of an evolutionary process. Based on demand and supply considerations the evolutionary model presented here derives explicitly Gibrat's law of proportionate effects as the result of the competition between products. Applying a preferential attachment mechanism for firms the theory allows to establish the size distribution of products and firms. Also established are the growth rate and price distribution of consumer goods. Taking into account the characteristic property of human activities to occur in bursts, the model allows also an explanation of the size-variance relationship of the growth rate distribution of products and firms. Further the product life cycle, the learning (experience) curve and the market size in terms of the mean number of firms that can survive in a market are derived. The model also suggests the existence of an invariant of a market as the ratio of total profit to total revenue. The relationship between a neo-classic and an evolutionary view of a market is discussed. The comparison with empirical investigations suggests that the theory is able to describe the main stylized facts concerning the size and growth of firms.

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A study of the personal income distribution in Australia

Cited by 86 publications

References 13 publications

Modelling of income distribution in the European Union with the Fokker–Planck equation

Modelling of income distribution in the European Union with the Fokker–Planck equation

Fréchet Distribution Applied to Salary Incomes in Spain from 1999 to 2014. An Engineering Approach to Changes in Salaries’ Distribution

Evolutionary model of the growth and size of firms

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