Reed, William J. - In: Physica A: Statistical Mechanics and its Applications 319 (2003) C, pp. 469-486
A stochastic model for the generation of observed income distributions is used to provide an explanation for the Pareto law of incomes. Analysis of the model also yields a prediction of Paretian (power law) behaviour in the lower tail of the distribution and this is shown to occur in a number of...