A modified family of power transformation, called the Dual Power Transformation, is proposed, which overcomes the truncation problem of the Box-Cox power transformation. The new transformation possesses properties similar to those of the Box-Cox power transformation. It generates a rich family of distributions that is seen to be very useful in modeling and analysis of economic durations and medical/engineering event-times. Further, it gives rise to transformed (regression) models such that all the standard asymptotic results of the maximum likelihood theory apply. Empirical results presented are more favorable to the new transformation than to the Box-Cox power transformation in terms of model fit.
Singapore Management University School of Economics and Social Sciences
City or Country
A Modified Family of Power Transformations. (2002). 12-2002,. Research Collection School Of Economics.
Available at: http://ink.library.smu.edu.sg/soe_research/698
Creative Commons License
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 4.0 License.