A Comparison of Parametric Models of Income Distribution Across Countries and Over Time

The five-parameter generalized beta distribution and ten of its special cases are considered as models fore the size distribution of income. The models are fit to income data for 23 countries and various years - a total of 82 datasets. Of the models considered, the Weibull, Daagum and generalized beta of the second kind are best fitting of the models with two, three and four parameters for 62 percent, 84 percent, and 96 percent of the data sets, respectively. Increasing inequality with respect to pre-tax income is observed in most of the countries considered