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30 – Testing/Estimation

A Mixture Truncated Pareto Distribution

Sponsor: Section on Statistical Computing
Keywords: Heavy Tailed Distributions, Goodness-of-fit tests, Order Statistics, Truncated Pareto Distribution, Cluster

Percy Brill

University of Windsor

Vincenzo Coia

Brock University

Mei Ling Huang

Brock University

Heavy tailed distributions have many applications in the real world. The Pareto distribution is very popular. The tail distribution is important but the threshold of the distribution is difficult to determine. We propose a mixture truncated Pareto distribution (MTPD). This study leads us to construct a cluster Pareto distribution (CPD) estimation method. The paper studies a real world example which utilized the MTPD. The results of goodness of fit tests show that the MTPD and the cluster estimation method produce very good fitting distributions with real world data.

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