Confidence of compliance: a Bayesian approach for percentile standards.
Rules for assessing compliance with percentile standards commonly limit the number of exceedances permitted in a batch of samples taken over a defined assessment period. Such rules are commonly developed using classical statistical methods. Results from alternative Bayesian methods are presented (using beta-distributed prior information and a binomial likelihood), resulting in "confidence of compliance" graphs. These allow simple reading of the consumer's risk and the supplier's risks for any proposed rule. The influence of the prior assumptions required by the Bayesian technique on the confidence results is demonstrated, using two reference priors (uniform and Jeffreys') and also using optimistic and pessimistic user-defined priors. All four give less pessimistic results than does the classical technique, because interpreting classical results as "confidence of compliance" actually invokes a Bayesian approach with an extreme prior distribution. Jeffreys' prior is shown to be the most generally appropriate choice of prior distribution. Cost savings can be expected using rules based on this approach.
National Institute of Water & Atmospheric Research (NIWA), P.O. Box 11-15, Hamilton, New Zealand. g.mcbride@niwa.cri.nz
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D001499:Bayes Theorem; D006801:Humans; D016013:Likelihood Functions; D009520:New Zealand; D014867:Water / Q000592:standards*; D014876:Water Pollution / Q000517:prevention & control; D014881:Water Supply / Q000331:legislation & jurisprudence / Q000592:standards*
D014867:Water