Exponentiated Kumaraswamy-Dagum distribution with applications to income and lifetime data

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1 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 RESEARCH Open Access Exponentated Kumaraswamy-Dagum dstrbuton wth applcatons to ncome and lfetme data Shujao Huang and Broderck O Oluyede * *Correspondence: boluyede@georgasouthern.edu Department of Mathematcal Scences Georga Southern Unversty Statesboro GA USA Abstract A new famly of dstrbutons called exponentated Kumaraswamy-Dagum (EKD) dstrbuton s proposed and studed. Ths famly ncludes several well known sub-models such as Dagum (D) Burr III (BIII) Fsk or Log-logstc (F or LLog) and new sub-models namely Kumaraswamy-Dagum (KD) Kumaraswamy-Burr III (KBIII) Kumaraswamy-Fsk or Kumaraswamy-Log-logstc (KF or KLLog) exponentated Kumaraswamy-Burr III (EKBIII) and exponentated Kumaraswamy-Fsk or exponentated Kumaraswamy-Log-logstc (EKF or EKLLog) dstrbutons. Statstcal propertes ncludng seres representaton of the probablty densty functon hazard and reverse hazard functons moments mean and medan devatons relablty Bonferron and Lorenz curves as well as entropy measures for ths class of dstrbutons and the sub-models are presented. Maxmum lkelhood estmates of the model parameters are obtaned. Smulaton studes are conducted. Examples and applcatons as well as comparsons of the EKD and ts sub-dstrbutons wth other dstrbutons are gven. Mathematcs Subject Classfcaton (2000): 62E10; 62F30 Keywords: Dagum dstrbuton; Exponentated Kumaraswamy-Dagum dstrbuton; Maxmum lkelhood estmaton 1 Introducton Camlo Dagum proposed the dstrbuton whch s referred to as Dagum dstrbuton n Ths proposal enable the development of statstcal dstrbutons used to ft emprcal ncome and wealth data that could accommodate heavy tals n ncome and wealth dstrbutons. Dagum s proposed dstrbuton has both Type-I and Type-II specfcaton where Type-I s the three parameter specfcaton and Type-II deals wth four parameter specfcaton. Ths dstrbuton s a specal case of generalzed beta dstrbuton of the second knd (GB2) McDonald (1984) McDonald and Xu (1995) when the parameter q = 1 where the probablty densty functon (pdf) of the GB2 dstrbuton s gven by: ay ap 1 f GB2 (y; a b p q) = b ap B(p q)[1 + ( y ) a fory > 0. b ] p+q See Kleber and Kotz (2003) for detals. Note that a > 0 p > 0 q > 0 are the shape parameters and b s the scale parameter and B(p q) = Ɣ(p)Ɣ(q) Ɣ(p+q) s the beta functon. Kleber (2008) traced the geness of Dagum dstrbuton and summarzed several 2014 Huang and Oluyede; lcensee Sprnger. Ths s an Open Access artcle dstrbuted under the terms of the Creatve Commons Attrbuton Lcense ( whch permts unrestrcted use dstrbuton and reproducton n any medum provded the orgnal work s properly credted.

2 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 2 of 20 statstcal propertes of ths dstrbuton. Domma et al. (2011) obtaned the maxmum lkelhood estmates of the parameters of Dagum dstrbuton for censored data. Domma and Condno (2013) presented the beta-dagum dstrbuton. Cordero et al. (2013) proposed the beta exponentated Webull dstrbuton. Cordero et al. (2010) ntroduced and studed some mathematcal propertes of the Kumaraswamy Webull dstrbuton. Oluyede and Rajasoorya (2013) developed the Mc-Dagum dstrbuton and presented ts statstcal propertes. See references theren for addtonal results. The pdf and cumulatve dstrbuton functon (cdf) of Dagum dstrbuton are gven by: g D (x; λ β δ) = βλδx δ 1 ( ) β 1 (1) and G D (x; λ β δ) = ( ) β (2) for x > 0 where λ s a scale parameter δ and β are shape parameters. Dagum (1977) refers to hs model as the generalzed logstc-burr dstrbuton. The k th raw or non central moments are gven by E (X k) ( = βλ k δ B β + k δ 1 k ) δ for k <δandλ β>0 where B( ) s the beta functon. The q th percentle s x q = λ 1 δ ( q 1 β 1) 1 δ. In ths paper we present generalzatons of the Dagum dstrbuton va Kumaraswamy dstrbuton and ts exponentated verson. Ths leads to the exponentated Kumaraswamy Dagum dstrbuton. The motvaton for the development of ths dstrbuton s the modelng of sze dstrbuton of personal ncome and lfetme data wth a dverse model that takes nto consderaton not only shape and scale but also skewness kurtoss and tal varaton. Also the EKD dstrbuton and ts sub-models has desrable features of exhbtng a non-monotone falure rate thereby accommodatng dfferent shapes for the hazard rate functon and should be an attractve choce for survval and relablty data analyss. Ths paper s organzed as follows. In secton 3 we present the exponentated Kumaraswamy-Dagum dstrbuton and ts sub models as well as seres expanson hazard and reverse hazard functons. Moments moment generatng functon Lorenz and Bonferron curves mean and medan devatons and relablty are obtaned n secton 4. Secton 5 contans results on the dstrbuton of the order statstcs and Reny entropy. Estmaton of model parameters va the method of maxmum lkelhood s presented n secton 6. In secton 7 varous smulatons are conducted for dfferent sample szes. Secton 8 contans examples and applcatons of the EKD dstrbuton and ts sub-models followed by concludng remarks. 2 Methods results and dscussons Methods results and dscussons for the class of EKD dstrbutons are presented n sectons 3 to 8. These sectons nclude the sub-models seres expanson of the pdf closed form expressons for the hazard and reverse hazard functons moments moment generatng functon Bonferron and Lorenz curves relablty mean and medan devatons

3 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 3 of 20 dstrbuton of order statstcs and entropy as well as estmaton of model parameters and applcatons. 3 The exponentated Kumaraswamy-Dagum dstrbuton In ths secton we present the proposed dstrbuton and ts sub-models. Seres expanson hazard and reverse hazard functons are also studed n ths secton. 3.1 Kumaraswamy-Dagum dstrbuton Kumaraswamy (1980) ntroduced a two-parameter dstrbuton on (0 1). Itscdfsgven by G(x) = ( x ψ) φ x (0 1) for ψ>0andφ>0. For an arbtrary cdf F(x) wth pdf f (x) = df(x) dx the famly of Kumaraswamy-G dstrbutons wth cdf G k (x) s gven by G K (x) = ( F ψ (x) ) φ for ψ>0andφ>0. By lettng F(x) = G D (x) we obtan the Kumaraswamy-Dagum (KD) dstrbuton wth cdf ( ) G KD (x) = G ψ φ D (x). 3.2 The EKD dstrbuton In general the EKD dstrbuton s G EKD (x) = [F KD (x)] θ wheref KD (x) s a baselne (Kum-Dagum) cdf θ > 0 wth the correspondng pdf gven by g EKD (x) = θ[f KD (x)] θ 1 f KD (x). For large values of x andforθ>1(< 1) the multplcatve factor θ[f KD (x)] θ 1 > 1(< 1) respectvely. The reverse statement holds for smaller values of x. Consequently ths mples that the ordnary moments of g EKD (x) are larger (smaller) than those of f KD (x) when θ>1(< 1). Replacng the dependent parameter βψ by α the cdf and pdf of the EKD dstrbuton are gven by G EKD (x; α λ δ φ θ) = { ) α ] } φ θ (3) and g EKD (x; α λ δ φ θ) = αλδφθx δ 1 ( ) α 1 [ ( ) α ] φ 1 { ) α ] } φ θ 1 (4) for α λ δ φ θ>0 and x > 0 respectvely. The quantle functon of the EKD dstrbuton s n closed form [ ( ) G 1 (q) = x EKD q = λ 1 δ q θ 1 1 ] 1 α φ 1 1 δ. (5) Plots of the pdf for some combnatons of values of the model parameters are gven n Fgure 1. The plots ndcate that the EKD pdf can be decreasng or rght skewed. The EKD dstrbuton has a postve asymmetry.

4 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 4 of 20 Fgure 1 Graph of pdfs. 3.3 Some sub-models Sub-models of EKD dstrbuton for selected values of the parameters are presented n ths secton. 1. When θ = 1 we obtan Kumaraswamy-Dagum dstrbuton wth cdf: [ G(x; α λ δ φ) = ( ) α ] φ for α λ δ φ>0 and x > When φ = θ = 1 we obtan Dagum dstrbuton wth cdf: G(x; α λ δ) = ( ) α for α λ δ>0 and x > When λ = 1 we obtan exponentated Kumaraswamy-Burr III dstrbuton wth cdf: G(x; α δ φ θ) = { 1 + x δ) α ] } φ θ for α δ φ θ>0and x > When λ = θ = 1 we obtan Kumaraswamy-Burr III dstrbuton wth cdf: [ G(x; α δ φ) = ( 1 + x δ) α ] φ for α δ φ>0 and x > When λ = φ = θ = 1 we obtan Burr III dstrbuton wth cdf: G(x; α δ) = ( 1 + x δ) α for α δ>0and x > When α = 1 we obtan exponentated Kumaraswamy-Fsk or Kumaraswamy-Log-logstc dstrbuton wth cdf: { G(x; λ δ φ θ) = ) 1 ] } φ θ for λ δ φ θ>0 and x > 0.

5 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 5 of When α = θ = 1 we obtan Kumaraswamy-Fsk or Kumaraswamy-Log-logstc dstrbuton wth cdf: [ G(x; λ δ φ) = ( ) 1 ] φ for λ δ φ>0 and x > When α = φ = θ = 1 we obtan Fsk or Log-logstc dstrbuton wth cdf: G(x; λ δ) = ( ) 1 for λ δ>0 and x > Seres expanson of EKD dstrbuton We apply the seres expanson ( z) b 1 = j=0 ( 1) j Ɣ(b) Ɣ(b j)j! zj (6) for b > 0and z < 1 to obtan the seres expanson of the EKD dstrbuton. By usng equaton (6) g EKD (x) = =0 j=0 ω( j)x δ 1 ( ) α(j+1) 1 (7) where ω( j) = αλδφθ ( 1)+j Ɣ(θ)Ɣ(φ+φ) Ɣ(θ )Ɣ(φ+φ j)!j!. Note that n the Dagum(α δ λ) dstrbuton α and δ are shape parameters and λ s a scale parameter. In the Exponentated-Kumaraswamy(ψ φ θ) dstrbuton ψ s a skewness parameter φ s a tal varaton parameter and the parameter θ characterzes the skewness kurtoss and tal of the dstrbuton. Consequently for the EKD(α λ δ φ θ) dstrbuton α s shape and skewness parameter δ s shape parameter λ s a scale parameter φ s a tal varaton parameter and the parameter θ characterzes the skewness kurtoss and tal of the dstrbuton. 3.5 Hazard and reverse hazard functon The hazard functon of the EKD dstrbuton s h EKD (x) = g (x) EKD G EKD (x) = αλδφθx δ 1 ( ) α 1 [ ( ) α ] φ 1 [ {1 ( ) α ] φ } θ 1 ( { ) α ] } ) φ θ 1. (8) Plots of the hazard functon are presented n Fgure 2. The plots show varous shapes ncludng monotoncally decreasng unmodal and bathtub followed by upsde down bathtub shapes wth fve combnatons of the values of the parameters. Ths attractve flexblty makes the EKD hazard rate functon useful and sutable for non-monotone emprcal hazard behavors whch are more lkely to be encountered or observed n real lfe stuatons. Unfortunately the analytcal analyss of the shape of both the densty (except for zero modal when αδ 1 and unmodal f αδ > 1 both for φ = θ = 1) and

6 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 6 of 20 Fgure 2 Graphs of hazard functons. hazard rate functon seems to be very complcated. We could not determne any specfc rules for the shapes of the hazard rate functon. The reverse hazard functon of the EKD dstrbuton s τ EKD (x) = g EKD (x) G EKD (x) = αλδφθx δ 1 ( ) α 1 [ ( ) α ] φ 1 { ) α ] } φ 1. (9) 4 Moments moment generatng functon Bonferron and Lorenz curves mean and medan devatons and relablty In ths secton we present the moments moment generatng functon Bonferron and Lorenz curves mean and medan devatons as well as the relablty of the EKD dstrbuton. The moments of the sub-models can be readly obtaned from the general results. 4.1 Moments and moment generatng functon Let t = ( ) 1 n equaton (7) then the s th raw moment of the EKD dstrbuton s gven by E(X s ) = = = 0 =0 j=0 =0 j=0 x s g EKD (x)dx ω( j)λ δ s 1 1 ( δ B α(j + 1) + s δ 1 s ) δ ( ω( j s)b α(j + 1) + s δ 1 s ) δ (10) where ω( j s) = αλ δ s φθ ( 1)+j Ɣ(θ)Ɣ(φ+φ) Ɣ(θ )Ɣ(φ+φ j)!j! ands <δ.

7 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 7 of 20 The moment generatng functon of the EKD dstrbuton s gven by ( M(t) = ω( j r) tr r! B α(j + 1) + r δ 1 r ) δ for r <δ. r=0 =0 j=0 4.2 Bonferron and Lorenz curves Bonferron and Lorenz curves are wdely used tool for analyzng and vsualzng ncome nequalty. Lorenz curve L(p) can be regarded as the proporton of total ncome volume accumulated bythoseunts wth ncome lower than or equal to the volume a and Bonferron curve B(p) s the scaled condtonal mean curve that s rato of group mean ncome of the populaton. Plots of Bonferron and Lorenz curves are gven n Fgure 3. Let I(a) = a 0 x g EKD (x)dx and μ = E(X) then Bonferron and Lorenz curves are gven by B(p) = I(q) I(q) and L(p) = pμ μ respectvely for 0 p 1 and q = G 1 EKD (p). The mean of the EKD dstrbuton s obtaned from equaton (10) wth s = 1 and the quantle functon s gven n equaton (5). Consequently ( I(a) = ω( j1)b t(a) α(j + 1) + 1 δ 1 1 ) (11) δ =0 j=0 for δ > 1 where t(a) = (1 + λa δ ) 1 andb G(x) (c d) = G(x) 0 t c 1 ( t) d 1 dt for G(x) < 1 s ncomplete Beta functon. 4.3 Mean and medan devatons If X has the EKD dstrbuton we can derve the mean devaton about the mean μ = E(X) and the medan devaton about the medan M from δ 1 = x μ g EKD (x)dx and δ 2 = x M g EKD (x)dx 0 respectvely. The mean μ s obtaned from equaton (10) wth s = 1 and the medan M s gvenbyequaton(5)whenq = Fgure 3 Graphs of Bonferron and Lorenz curves.

8 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 8 of 20 The measure δ 1 and δ 2 can be calculated by the followng relatonshps: δ 1 = 2μ G EKD (μ) 2μ + 2T(μ) and δ 2 = 2T(M) μ where T(a) = a x g EKD (x)dx follows from equaton (11) that s T(a) = ω( j1) B α(j + 1) + 1 δ 1 1 δ =0 j=0 ) B t(a) ( α(j + 1) + 1 δ 1 1 δ 4.4 Relablty The relablty R = P(X 1 > X 2 ) when X 1 and X 2 have ndependent EKD(α 1 λ 1 δ 1 φ 1 θ 1 ) and EKD(α 2 λ 2 δ 2 φ 2 θ 2 ) dstrbutons s gven by R = = 0 g 1 (x)g 2 (x)dx ζ( j k l) =0 j=0 k=0 l=0 0 )]. x δ 1 1 ( 1 + λ 1 x δ 1 ) α 1 (j+1) 1 ( 1 + λ2 x δ 2 ) α 2 l dx ( 1) +j+k+l Ɣ(θ 1 )Ɣ(φ 1 +φ 1 )Ɣ(θ 2 +1)Ɣ(φ 2 k+1) Ɣ(θ )Ɣ(φ 1 +φ j)ɣ(θ 2 +1 k)ɣ(φ 2 k+1 l)!j!k!l!. where ζ( j k l) = α 1 λ 1 δ 1 φ 1 θ 1 If λ = λ 1 = λ 2 and δ = δ 1 = δ 2 then relablty can be reduced to ζ( j k l) R = λδ[α 1 (j + 1) + α 2 l]. j=1 k=1 l=1 5 Order statstcs and entropy In ths secton the dstrbuton of the k th order statstc and Reny entropy (Reny 1960) for the EKD dstrbuton are presented. The entropy of a random varable s a measure of varaton of the uncertanty. 5.1 Order statstcs The pdf of the k th order statstcs from a pdf f (x) s f (x) f k:n (x) = B(k n k + 1) Fk 1 (x)[ F(x)] n k ( ) n = k f (x)f k 1 (x)[ F(x)] n k. (12) k Usng equaton (6) the pdf of the k th order statstc from EKD dstrbuton s gven by g k:n (x) = K( j p k) x δ 1 ( ) α αp 1 =0 j=0 p=0 where K( j p k) = 5.2 Entropy ( 1)+j+p Ɣ(n k+1)ɣ(θk+θ)ɣ(φj+φ) Ɣ(n k+1 )Ɣ(θk+θ j)ɣ(φj+φ p)!j!p! k( n k) αλδφθ. Reny entropy of a dstrbuton wth pdf f (x) s defned as { } I R (τ) = ( τ) 1 log f τ (x)dx τ>0 τ = 1. R Usng equaton (6) Reny entropy of EKD dstrbuton s gven by I R (τ) = ( τ) 1 log ( 1) +j Ɣ(θτ τ + 1)Ɣ(φτ τ + φ + 1) Ɣ(θτ τ + )Ɣ(φτ τ + φ + j)! j! =0 j=0 ( α τ λ τ δ + 1 δ δ τ 1 φ τ θ τ B ατ + αj + τ τ + τ 1 δ δ ) ]. for ατ + αj + 1 τ δ obtaned. > 0andτ + τ 1 δ > 0. Reny entropy for the sub-models can be readly

9 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 9 of 20 6 Estmaton of model parameters In ths secton we present estmates of the parameters of the EKD dstrbuton va method of maxmum lkelhood estmaton. The elements of the score functon are presented. There are no closed form solutons to the nonlnear equatons obtaned by settng the elements of the score functon to zero. Thus the estmates of the model parameters must be obtaned va numercal methods. 6.1 Maxmum lkelhood estmaton Let x = (x 1 x n ) T be a random sample of the EKD dstrbuton wth unknown parameter vector = (α λ δ φ θ) T. The log-lkelhood functon for s n l( ) = n (ln α + ln λ + ln δ + ln φ + ln θ) (δ + 1) ln x (α + 1) + (θ 1) n ( ln { n ln ) + (φ 1) n ln ) ] } α φ [ ( ) α ]. (13) The partal dervatves of l( ) wth respect to the parameters are ( ) α ( ) l α = n n ( ) n α ln ln + (φ 1) ( ) α ) ] α φ 1 ( ) α ( ) n ln (θ 1)φ ) ] α φ l λ = n n λ (α + 1) (θ 1)φα n x δ + (φ 1)α ( ) α 1 n x δ ( ) α ) ] α φ 1 ( ) α 1 x δ ) ] α φ l δ = n n n δ x δ ln x ln x + (α + 1)λ ( ) α 1 n x δ ln x (φ 1)αλ ( ) α n + (θ 1)φαλ l φ = n n φ + and ln 1+λx δ ) α ] (θ 1) { l θ = n n θ + ln ) α ] φ 1 ( n ) α 1 x δ ln x ) ] α φ ) ] α φ ln ) ] } α φ ) α ] ) ] α φ

10 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 10 of 20 respectvely. The MLE of the parameters α λ δ φ andθ say ˆα ˆλ ˆδ ˆφ and ˆθ mustbe obtaned by numercal methods. 6.2 Asymptotc confdence ntervals In ths secton we present the asymptotc confdence ntervals for the parameters of the EKD dstrbuton. The expectatons n the Fsher Informaton Matrx (FIM) can be obtaned numercally. Let ˆ = ( ˆα ˆλ ˆδ ˆφ ˆθ) be the maxmum lkelhood estmate of = (α λ δ φ θ). Under the usual regularty condtons and that the parameters are n the nteror of the parameter space but not on the boundary we have: d n( ˆ ) N 5 (0 I 1 ( )) wherei( ) s the expected Fsher nformaton matrx. The asymptotc behavor s stll vald f I( ) s replaced by the observed nformaton matrx evaluated at ˆ thatsj( ˆ ). The multvarate normal dstrbuton N 5 (0 J( ˆ ) 1) where the mean vector 0 = ( ) T can be used to construct confdence ntervals and confdence regons for the ndvdual model parameters and for the survval and hazard rate functons. The approxmate 100( η)% two-sded confdence ntervals for α λ δ φ and θ are gven by: α ± Z η Iαα 1 ( ) 2 λ ± Z η I 1 2 λλ ( ) δ ± Z η I 1 2 δδ ( ) φ ± Z η I 1 2 φφ ( ) θ ± Z η I 1 2 θθ ( ) respectvely where Z η s the upper η th 2 2 percentle of a standard normal dstrbuton. We can use the lkelhood rato (LR) test to compare the ft of the EKD dstrbuton wth ts sub-models for a gven data set. For example to test θ = 1 the LR statstc s ( )) ( ( ))] ω = 2 ln L ˆα ˆλ ˆδ ˆφ ˆθ ln L α λ δ φ 1 where ˆα ˆλ ˆδ ˆφ and ˆθ are the unrestrcted estmates and α λ δ and φ are the restrcted estmates.thelrtestrejectsthenullhypothessfω>χ 2whereχ2 denote the upper d d 100d% pont of the χ 2 dstrbuton wth 1 degrees of freedom. 7 Smulaton study In ths secton we examne the performance of the EKD dstrbuton by conductng varous smulatons for dfferent szes (n= ) va the subroutne NLP n SAS. We smulate 2000 samples for the true parameters values I : α = 2 λ = 1 δ = 3 φ = 2 θ = 2andII : α = 1 λ = 1 δ = 1 φ = 1 θ = 1. Table 1 lsts the means MLEs of the fve model parameters along wth the respectve root mean squared errors (RMSE). From the results we can verfy that as the sample sze n ncreases the mean estmates of the parameters tend to be closer to the true parameter values snce RMSEs decay toward zero. 8 Applcaton: EKD and sub-dstrbutons In ths secton applcatons based on real data as well as comparson of the EKD dstrbuton wth ts sub-models are presented. We provde examples to llustrate the flexblty of the EKD dstrbuton n contrast to other models ncludng the exponentated

11 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 11 of 20 Table 1 Monte Carlo smulaton results: mean estmates and RMSEs I II n Parameter Mean RMSE Mean RMSE 200 α λ δ φ θ α λ δ φ θ α λ δ φ θ α λ δ φ θ Kumaraswamy-Webull (EKW) and beta-kumaraswamy-webull (BKW) dstrbutons for data modelng. The pdfs of EKW and BKW dstrbutons are [ f EKW (x) = θabcλ c x c 1 e (λx)c e (λx)c] a 1 { [ e (λx)c] a} b 1 [ { [ e (λx)c] ] a} b θ 1 and f BKW (x) = 1 B(a b) αβcλc x c 1 e (λx)c [ e (λx)c] α 1 { [ e (λx)c] α} βb 1 [ { [ e (λx)c] ] α} β a 1 respectvely. The frst data set conssts of the number of successve falures for the ar condtonng system of each member n a fleet of 13 Boeng 720 jet arplanes (Proschan 1963). The data s presented n Table 2. The second data set conssts of the salares of 818 professonal baseball players for the year 2009 (USA TODAY). The thrd data set represents the poverty rate of 533 dstrcts wth more than students n 2009 (Dgest of Educaton Statstcs d11/tables/dt11_096.asp ). These data sets are modeled by the EKD dstrbuton and compared wth the correspondng sub-models the Kumaraswamy-Dagum and Dagum

12 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 12 of 20 Table 2 Ar condtonng system data dstrbutons and as well as EKW BKW dstrbutons. Table 3 gves a descrptve summary of each sample. The ar condtonng system sample has far more varablty and the baseball player salary sample has the lowest varablty. The maxmum lkelhood estmates (MLEs) of the parameters are computed by maxmzng the objectve functon va the subroutne NLMIXED n SAS. The estmated values of the parameters (standard error n parenthess) -2 Log-lkelhood statstc Akake Informaton Crteron AIC = 2p 2ln(L) Bayesan Informaton Crteron BIC = p ln(n) 2ln(L) and Consstent Akake Informaton Crteron AICC = AIC + 2 p(p+1) n p 1 where L = L( ˆ ) s the value of the lkelhood functon evaluated at the parameter estmates n s the number of observatons and p s the number of estmated parameters for the EKD dstrbuton and ts sub-dstrbutons are tabulated. See Table 4 Table 5 and Table 6. Plots of the ftted EKD KD D and the hstogram of the data are gven n Fgure 4. The probablty plots (Chambers et al. 1983) conssts of plots of the observed probabltes aganst the probabltes predcted by the ftted model are also presented n Fgure 5. For the EKD dstrbuton we plotted for example { G(x (j) ) = 1 + ˆλx ˆδ (j) ) ˆα ] ˆφ } ˆθ aganst j n+0.25 j = n wherex (j) are the ordered values of the observed data. A measure of closeness of the plot to the dagonal lne gven by the sum of squares SS = n j=1 [ G(x (j) ) ( j n )] 2 Table 3 Descrptve statstcs Data Mean Medan Mode SD Varance Skewness Kurtoss Mn. Max. I II III

13 Table 4 Estmaton of models for ar condtonng system data Estmates Statstcs Dstrbuton α λ δ φ θ -2 log lkelhood AIC AICC BIC SS EKD (1.2347) (0.4174) (0.0459) (5.8028) (0.0089) KD (2.1177) (3.0727) (0.1253) ( ) - D (0.1749) ( ) (0.0663) - - a b c λ θ EKW (0.8783) (0.0183) (0.1448) (0.0224) (0.1136) a b α β c λ BKW (1.2507) (0.0875) (1.6573) (1.9807) (0.0343) (0.0388) Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 13 of 20

14 Table 5 Estmaton of models for baseball player salary data Estmates Statstcs Dstrbuton α λ δ φ θ -2 log lkelhood AIC AICC BIC SS EKD ( ) ( ) (0.0557) (0.0044) (0.0327) KD ( ) ( ) (0.037) (0.0036) - D ( ) (0.0058) (0.0301) - - a b c λ θ EKW (2.0692) (0.0266) (0.0756) (4.9198) (0.2098) a b α β c λ BKW (0.6879) (0.0039) (0.2069) (0.4549) (0.006) (2.4559) Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 14 of 20

15 Table 6 Estmaton of models for poverty rate data Estmates Statstcs Dstrbuton α λ δ φ θ -2 log lkelhood AIC AICC BIC SS EKD ( ) (0.32) (0.0714) ( ) ( ) KD ( ) (0.0963) (0.0555) ( ) - D (0.2034) (105.94) (0.0784) - - a b c λ θ EKW (0.0944) (1.8026) (2.2276) (0.0199) ( ) a b α β c λ BKW (0.0069) (0.0431) (0.0584) (0.0017) (0.2564) (0.0075) Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 15 of 20

16 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 16 of 20 Fgure 4 Ftted PDF for data sets. was calculated for each plot. The plot wth the smallest SS corresponds to the model wth ponts that are closer to the dagonal lne. Plots of the emprcal and estmated survval functons for the models are also presented n Fgure 6. For the ar condtonng system data ntal values α = 1 λ = 2 δ = 0.6 φ = 3 θ = 1 are used n SAS code for EKD model. The LR statstcs for the test of the hypothess H 0 : KD aganst H a : EKD and H 0 : D aganst H a : EKD are 1.9 (p-value = 0.17) and 13.4 (p-value = ). Consequently KD dstrbuton s the best dstrbuton based on the LR statstc. The KD dstrbuton gves smaller SS value than Dagum dstrbuton and slghtly bgger than EKD. For the non nested models the values of AIC and AICC for KD and EKW models are very close however the BIC value for KD dstrbuton s slghtly smaller than the correspondng value for the EKW dstrbuton. We conclude that KD model compares favorably wth the EKW dstrbuton and thus provdes a good ft for the ar condtonng system data. For the baseball player salary data set ntal values for EKD model n SAS code are α = 70 λ = 0.01 δ = φ = 0.1 θ = 1. The EKD dstrbuton s a better ft than KD and Dagum dstrbutons for ths data as well as the other dstrbutons. The values of the statstcs AIC AICC and BIC for KD dstrbuton are smaller compared to the non nested dstrbutons. The LR statstcs for the test of the hypotheses H 0 : KD aganst H a : EKD and H 0 : D aganst H a : EKD are 93.1 (p-value< ) and 361.5

17 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 17 of 20 Fgure 5 Observed probablty vs predcted probablty for data sets. (p-value < ). Consequently we reject the null hypothess n favor of the EKD dstrbuton and conclude that the EKD dstrbuton s sgnfcantly better than the KD and Dagum dstrbutons based on the LR statstc. The value of AIC AICC and BIC statstcs are lower for the EKD dstrbuton when compared to those for the EKW and BKW dstrbutons. For poverty rate data ntal values for EKD model are α = 73 λ = 0.1 δ = 0.15 φ = 60 θ = The LR statstc for the test of the hypotheses H 0 : KD aganst H a : EKD and H 0 : D aganst H a : EKD are 8.2 (p-value = ) and 81.1 (p-value < ) respectvely. The values of AIC AICC and BIC statstcs shows EKD dstrbutons s a better model and the SS value of EKD model s comparatvely smaller than the correspondng values for the KD and D dstrbutons. Consequently we conclude that EKD dstrbuton sthebestftforthepovertyratedata. 9 Conclusons We have proposed and presented results on a new class of dstrbutons called the EKD dstrbuton. Ths class of dstrbutons have applcatons n ncome and lfetme data analyss. Propertes of ths class of dstrbutons ncludng the seres expanson of pdfs cdfs moments hazard functon reverse hazard functon ncome nequalty measures such as Lorenz and Bonferron curves are derved. Reny entropy order statstcs relablty mean

18 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 18 of 20 Fgure 6 Emprcal survval functon for data sets. and medan devatons are presented. Estmaton of the parameters of the models and applcatons are also gven. Future work nclude MCMC methods wth censored data and regresson problems wth concomtant nformaton. Appendx RCodes nstall.packages( stats4 ) nstall.packages( bbmle ) lbrary(stats4) lbrary(bbmle) lbrary(stats) # Defne Functon #defneekdpdf g=functon(alphalambdadeltaphthetax){ y=alpha*lambda*delta*ph*theta*((x)ˆ(-delta-1))*((1+lambda*(xˆ(-delta)))ˆ(-alpha-1))*((1-((1+lambda*(xˆ(-delta)))ˆ(- alpha)))ˆ(ph-1))*((1-((1-((1+lambda*(xˆ(-delta)))ˆ(-alpha)))ˆ(ph)))ˆ(theta-1)) return(y) } #defneekdcdf

19 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 19 of 20 G=functon(alphalambdadeltaphthetax){ y=(1-((1-((1+lambda*(xˆ(-delta)))ˆ(-alpha)))ˆ(ph)))ˆ(theta) return(y) } #defneekdhazard h=functon(alphalambdadeltaphthetax){ y=g(alphalambdadeltaphthetax)/(1-g(alphalambdadeltaphthetax)) return(y) } #defneekdquantle quantle=functon(alphalambdadeltaphthetaq){ ((lambda)ˆ(1/delta))*((((1-((1-((q)ˆ(1/theta)))ˆ(1/ph)))ˆ(-1/alpha))-1)ˆ(-1/delta)) } # defne EKD moments. #note:k<delta moments=functon(alphalambdadeltaphthetak){ f=functon(alphalambdadeltaphthetakx){(xˆk)*(g(alphalambdadeltaphthetax))} y=ntegrate(flower=0upper=infsubdvsons=100000alpha=alphalambda=lambdadelta=deltaph=phtheta=thetak=k) return(y) } #defneekdi(a) Ia=functon(alphalambdadeltaphthetaa){ n=length(a) y=0 for( n 1:n){ y[]=ntegrate(functon(alphalambdadeltaphthetax){x*g(alphalambdadeltaphthetax)}lower=0upper=a[] subdvsons=100000alpha=alphalambda=lambdadelta=deltaph=phtheta=theta)$value } return(y) } # defne EKD bonferron # note: p s between (01) bonferron=functon(alphalambdadeltaphthetap){ q=quantle(alphalambdadeltaphthetap) mu=moments(alphalambdadeltaphtheta1)$value y=(ia(alphalambdadeltaphthetaq))/(p*mu) return(y) } #defneekdlorenz # note: p s between (01) lorenz=functon(alphalambdadeltaphthetap){ q=quantle(alphalambdadeltaphthetap) mu=moments(alphalambdadeltaphtheta1)$value y=(ia(alphalambdadeltaphthetaq))/(mu) return(y) }

20 Huang and Oluyede Journal of Statstcal Dstrbutons and Applcatons :8 Page 20 of 20 Competng nterests The authors declare that they have no competng nterests. Authors contrbutons SH provded the R codes conducted the smulatons and the applcatons. BOO proposed developed the statstcal propertes of the new famly of dstrbutons and drafted the manuscrpt. All authors read and approved the fnal manuscrpt. Authors nformaton Shujao Huang s a graduate student at Georga Southern Unversty and Broderck O. Oluyede s Professor of Mathematcs and Statstcs at Georga Southern Unversty. Receved: 22 November 2013 Accepted: 11 March 2014 Publshed: 16 June 2014 References Chambers J Cleveland W Klener B Tukey P: Graphcal Methods for Data Analyss. Chapman and Hall London (1983) Cordero GM Ortega EMM Nadarajah S: The Kumaraswamy Webull dstrbuton wth applcaton to falure data. J. Frankln Inst (2010) Cordero GM Gomes AE de-slva CQ Ortega EMM: The Beta Exponentated Webull Dstrbuton. J. Stat. Comput. Smulat. 83(1) (2013) Dagum CA: New model of personal ncome dstrbuton: specfcaton and estmaton. Econome Applque e (1977) Domma F Condno F: The Beta-Dagum dstrbuton: defnton and propertes. Communcatons n Statstcs-Theory and Methods. 44(22) (2013) Domma F Gordano S Zenga M: Maxmum lkelhood estmaton n Dagum dstrbuton wth censored samples. J. Appl. Stat. 38(21) (2011) Kleber C: A Gude to the Dagum Dstrbutons. In: Duangkamon C (ed.) Modelng Income Dstrbutons and Lorenz Curve Seres: Economc Studes n Inequalty Socal Excluson and Well-Beng 5. Sprnger New York (2008) Kleber C Kotz S: Statstcal sze dstrbutons n economcs and actuaral scences. Wley New York (2003) Kumaraswamy P: Generalzed probablty densty functon for double-bounded random process. J. Hydrol (1980) McDonald B: Some generalzed functons for the sze dstrbuton of ncome. Econometrca. 52(3) (1984) McDonald B Xu J: A generalzaton of the beta dstrbuton wth applcaton. J. Econometrcs. 69(2) (1995) Oluyede BO Rajasoorya S: The Mc-Dagum Dstrbuton and Its Statstcal Propertes wth Applcatons. Asan J. Mathematcs and Applcatons. 2013(85) (2013) Proschan F: Theoretcal explanaton of observed decreasng falure rate. Technometrcs (1963) Reny A: On measures of entropy and nformaton. Berkeley Symp. Math. Stat. Probablty. 1(1) (1960) do: / Cte ths artcle as: Huang and Oluyede: Exponentated Kumaraswamy-Dagum dstrbuton wth applcatons to ncome and lfetme data. Journal of Statstcal Dstrbutons and Applcatons :8. Submt your manuscrpt to a journal and beneft from: 7 Convenent onlne submsson 7 Rgorous peer revew 7 Immedate publcaton on acceptance 7 Open access: artcles freely avalable onlne 7 Hgh vsblty wthn the feld 7 Retanng the copyrght to your artcle Submt your next manuscrpt at 7 sprngeropen.com