Hierarchy and the Power-Law Income Distribution Tail

Hierarchy and the Power-Law Income Distribution Tail
Fix, Blair. (2018). Journal of Computational Social Science. OnlineFirst. July. pp. 1-21. (Article - Journal; English).

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Alternative Locations

https://link.springer.com/article/10.1007/s42001-018-0019-8, https://osf.io/mb3ah/, http://www.capitalaspower.com/2018/07/fix-hierarchy-and-the-power-law-income-distribution-tail/, https://www.econstor.eu/handle/10419/180820

Abstract or Brief Description

What explains the power-law distribution of top incomes? This paper tests the hypothesis that it is firm hierarchy that creates the power-law income distribution tail. Using the available case-study evidence on firm hierarchy, I create the first large-scale simulation of the hierarchical structure of the US private sector. Although not tuned to do so, this model reproduces the power-law scaling of top US incomes. I show that this is purely an effect of firm hierarchy. This raises the possibility that the ubiquity of power-law income distribution tails is due to the ubiquity of hierarchical organization in human societies.

Language

English

Publication Type

Article - Journal

Additional Information

OnlineFirst

Keywords

power law income distribution firm hierarchy economic modeling

Subject

BN Power
BN Region - North America
BN Business Enterprise
BN Data & Statistics
BN Distribution
BN Industrial Organization
BN Institutions

Depositing User

Jonathan Nitzan

Date Deposited

21 Jul 2018 14:57

Last Modified

15 Sep 2018 16:01

URL:

https://bnarchives.net/id/eprint/546

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