The Size-Group Distribution of Income
Estimates of the relative shares of capital and labour are only one, rather unsatisfactory, way of describing the degree of income inequality. Individual incomes, even of employees, may include elements of both wages and property incomes, and the dispersion within each category of income may also be large. We shall ignore the distribution of property incomes — with the significant exception of ‘human capital’ — observing only that this will depend on the distribution of wealth, savings propensities and attitudes to risk-taking, and inheritance taxation and social customs (Reder ). We shall deal only with the distribution of earnings.
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