A new approach to the Box–Cox transformation

Jorge I. Vélez, Juan C. Correa, Fernando Marmolejo-Ramos*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

35 Citations (Scopus)

Abstract

We propose a new methodology to estimate λ, the parameter of the Box–Cox transformation, as well as an alternative method to determine plausible values for it. The former is accomplished by defining a grid of values for λ and further perform a normality test on the λ-transformed data. The optimum value of λ, say λ*, is such that the p-value from the normality test is the highest. The set of plausible values is determined using the inverse probability method after plotting the p-values against the values of λ on the grid. Our methodology is illustrated with two real-world data sets. Furthermore, a simulation study suggests that our method improves the symmetry, kurtosis and, hence, the normality of data, making it a feasible alternative to the traditional Box–Cox transformation.

Original languageEnglish
Article number12
JournalFrontiers in Applied Mathematics and Statistics
Volume1
DOIs
Publication statusPublished - 30 Oct 2015
Externally publishedYes

Bibliographical note

Publisher Copyright:
© Copyright © 2015 Vélez, Correa and Marmolejo-Ramos.

All Science Journal Classification (ASJC) codes

  • Statistics and Probability
  • Applied Mathematics

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