Bayesian inference for Pareto distribution with prior conjugate and prior non conjugate


  • Ferra YANUAR Andalas University
  • Cici Saputri Andalas University



Pareto distribution, posterior variance, absolute bias, Bayes confidence interval


The purpose of this study is to determine the best estimator for estimating the shape   parameters of the Pareto distribution with the known  scale parameter. Estimation of these parameters is done by using the Gamma distribution as the prior distribution of the conjugate and the Uniform distribution as the non-conjugate prior distribution. A comparison of the two prior distributions is done through simulation studies with various sample sizes. The best estimator net is a method that produces the smallest posterior variance, absolute bias, and Bayes confidence interval. This study proves that the Bayes estimator by using the prior conjugate distribution produces all indicators of the goodness of the model with a smaller value than the non-conjugate prior distribution. Thus it can be concluded that the estimator with prior conjugate will produce a better predictive value than prior non-conjugate.


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