Title

On the Rank, Generalized Lorenz and Overtaking Criteria for Evaluating Stochastic Income Regimes

Department

Economics, Finance, & Quantitative Analysis

Document Type

Article

Publication Date

1-1992

Abstract

This essay is concerned with the evaluation of income regimes, that is a set of income classes and the stochastic process which governs the individual's position among the income classes. We follow Champernowne, Theil, Shorrocks, Bartholomew, Geweke, Marshall, and Zarkin, and Conlisk in characterizing mobility as a Markov chain. Here, states of a Markov chain correspond to positions in the income classes.