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A Pareto upper tail for capital income distribution

Bogdan Oancea (), Dan Pirjol and Tudorel Andrei ()

Physica A: Statistical Mechanics and its Applications, 2018, vol. 492, issue C, 403-417

Abstract: We present a study of the capital income distribution and of its contribution to the total income (capital income share) using individual tax income data in Romania, for 2013 and 2014. Using a parametric representation we show that the capital income is Pareto distributed in the upper tail, with a Pareto coefficient α∼1.44 which is much smaller than the corresponding coefficient for wage- and non-wage-income (excluding capital income), of α∼2.53. Including the capital income contribution has the effect of increasing the overall inequality measures.

Keywords: Capital income distribution; Pareto tail; Income inequality (search for similar items in EconPapers)
Date: 2018
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DOI: 10.1016/j.physa.2017.09.034

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