Percent damage distribution
diegol <diegol81 <at> gmail.com> writes:
R version: 2.7.0 Running on: WinXP I am trying to model damage from fire losses (given that the loss occurred). Since I have the individual insured amounts, rather than sampling dollar damage from a continuous distribution ranging from 0 to infinity, I want to sample from a percent damage distribution from 0-100%. One obvious solution is to use runif(n, min=0, max=1), but this does not seem to be a good idea, since I would not expect damage to be uniform.
Beta distribution (rbeta(...)) or logistic-binomial distribution plogis(rnorm(...)) . See e.g. Smithson, Michael, and Jay Verkuilen. 2006. A better lemon squeezer? Maximum-likelihood regression with beta-distributed dependent variables. Psychological Methods 11, no. 1 (March): 54-71. doi:2006-03820-004.