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Testing Benford’s Law with the first two significant digitsWong, Stanley Chun Yu 07 September 2010 (has links)
Benford’s Law states that the first significant digit for most data is not uniformly distributed. Instead, it follows the distribution: P(d = d1) = log10(1 + 1/d1) for d1 ϵ {1, 2, …, 9}. In 2006, my supervisor, Dr. Mary Lesperance et. al tested the goodness-of-fit of data to Benford’s Law using the first significant digit. Here we extended the research to the first two significant digits by performing several statistical tests – LR-multinomial, LR-decreasing, LR-generalized Benford, LR-Rodriguez, Cramѐr-von Mises Wd2, Ud2, and Ad2 and Pearson’s χ2; and six simultaneous confidence intervals – Quesenberry, Goodman, Bailey Angular, Bailey Square, Fitzpatrick and Sison.
When testing compliance with Benford’s Law, we found that the test statistics LR-generalized Benford, Wd2 and Ad2 performed well for Generalized Benford distribution, Uniform/Benford mixture distribution and Hill/Benford mixture distribution while Pearson’s χ2 and LR-multinomial statistics are more appropriate for the contaminated additive/multiplicative distribution. With respect to simultaneous confidence intervals, we recommend Goodman and Sison to detect deviation from Benford’s Law.
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