Like ‘supply’, ‘demand’, ‘rent’, ‘welfare’ and ‘utility’, the word ‘income’ is a part of common speech that has entered economics as a technical term. The Concise Oxford Dictionary defines income as ‘receipts from one’s lands, work, investment etc’. That meaning carries over into economic theory, where, for instance, a consumer may be said to maximize utility subject to an income constraint or a firm may be said to maximize income accruing to its stockholders. The meaning of income is somewhat modified in the construction of income statistics. These are employed in two quite distinct contexts: as the basis for income taxation and as generalized to national income.
- On the definition of personal income, see Simons 1938. The classic discussion of the concept of national income, related conceptual problems and the history of the development of the national accounts is Studenski 1961. Most countries produce national accounts and publish details of how they are compiled. For a proposed standardization, see A System of National Accounts, United Nations, 1968. Current research in national accounting is likely to appear in The Review of Income and Wealth.Google Scholar
- Simons, H. 1938. Personal income taxation: The definition of income as a problem of fiscal policy. Chicago: University of Chicago Press.Google Scholar
- Studenski, P. 1961. The income of nations. New York: New York University Press.Google Scholar
- United Nations. 1968. A system of national accounts. New York: United Nations, Department of Economic and Social Affairs, Studies in methods, series F, no. 2.Google Scholar