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On the relationship between the reversed hazard rate and elasticity

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  • Ernesto Veres-Ferrer
  • Jose Pavía

Abstract

Despite hazard and reversed hazard rates sharing a number of similar aspects, reversed hazard functions are far less frequently used. Understanding their meaning is not a simple task. The aim of this paper is to expand the usefulness of the reversed hazard function by relating it to other well-known concepts broadly used in economics: (linear or cumulative) rates of increase and elasticity. This will make it possible (i) to improve our understanding of the consequences of using a particular distribution and, in certain cases, (ii) to introduce our hypotheses and knowledge about the random process in a more meaningful and intuitive way, thus providing a means to achieving distributions that would otherwise be hardly imaginable or justifiable. Copyright Springer-Verlag 2014

Suggested Citation

  • Ernesto Veres-Ferrer & Jose Pavía, 2014. "On the relationship between the reversed hazard rate and elasticity," Statistical Papers, Springer, vol. 55(2), pages 275-284, May.
    • Handle: RePEc:spr:stpapr:v:55:y:2014:i:2:p:275-284
    DOI: 10.1007/s00362-012-0470-1
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    References listed on IDEAS

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    1. Colangelo, Antonio & Scarsini, Marco & Shaked, Moshe, 2006. "Some positive dependence stochastic orders," Journal of Multivariate Analysis, Elsevier, vol. 97(1), pages 46-78, January.
    2. M. Poursaeed, 2010. "A note on the mean past and the mean residual life of a (n − k + 1)-out-of-n system under multi monitoring," Statistical Papers, Springer, vol. 51(2), pages 409-419, June.
    3. M. Razmkhah & H. Morabbi & J. Ahmadi, 2012. "Comparing two sampling schemes based on entropy of record statistics," Statistical Papers, Springer, vol. 53(1), pages 95-106, February.
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    Cited by:

    1. Paulo Oliveira & Nuria Torrado, 2015. "On proportional reversed failure rate class," Statistical Papers, Springer, vol. 56(4), pages 999-1013, November.
    2. Božidar V. Popović & Ali İ. Genç & Filippo Domma, 2022. "Generalized proportional reversed hazard rate distributions with application in medicine," Statistical Methods & Applications, Springer;Società Italiana di Statistica, vol. 31(3), pages 459-480, September.
    3. Hazra, Nil Kamal & Kuiti, Mithu Rani & Finkelstein, Maxim & Nanda, Asok K., 2017. "On stochastic comparisons of maximum order statistics from the location-scale family of distributions," Journal of Multivariate Analysis, Elsevier, vol. 160(C), pages 31-41.
    4. Auster, Sarah & Kellner, Christian, 2022. "Robust bidding and revenue in descending price auctions," Journal of Economic Theory, Elsevier, vol. 199(C).

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