Comparisons of stationary distributions of linear models

Shenghao Zhu ()

Economics Letters, 2013, vol. 119, issue 2, 221-223

Abstract: In this note, I compare stationary distributions of the linear model Xn+1=anXn+bn, where an and bn are non-negative random variables. I show that an increase of the variability of an and/or bn causes a less equal stationary distribution in terms of the Lorenz dominance. The result is useful in studies of wealth and income distributions.

Keywords: Comparisons; Lorenz dominance; Stationary distributions; Linear models (search for similar items in EconPapers)
JEL-codes: D31 D63 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:119:y:2013:i:2:p:221-223

DOI: 10.1016/j.econlet.2013.02.024

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