Selection of the Transformation Variable in the Laplace Transform Method of Estimation

Abstract
Summary: The work of this paper is based on the innovative approach of Feiginet al.(1983), who estimate parameters of lifetime distributions by equating empirical and theoretical Laplace transforms. We show that the optimal choice of the transform variable depends critically upon the number of sampling times, the way they are spaced, and how the empirical transform is formed. Two new approaches for choosing the transform variable, viz. using cross‐validation or constrained optimisation, are introduced and shown to have potential for wide‐ranging use.