Analysis of two-dimensional warranty data considering global and local dependence of heterogeneous marginals

Kunsong Lin and Yunxia Chen

Reliability Engineering and System Safety, 2021, vol. 207, issue C

Abstract: This paper conducts a two-dimensional warranty analysis on the data with heterogeneity in terms of both age and usage. Two models are developed to evaluate the severity of warranty claims. The first one uses a copula to describe the global dependence between the age and usage populations, whereas the second one further captures various local dependence in different warranty regions. Since the mixing proportions regarding heterogeneity are latent, the expectation maximization algorithm is proposed to estimate parameters and classify the warranty data. The likelihood ratio test is further utilized to determine the number of subpopulations. A comparison with two other models shows the superiority of the proposed one in terms of the Akaike information criterion. It is found that more than 85% of the claims are classified into normal failures, and local dependence structures might vary from a symmetric one to an asymmetric one. Meanwhile, as the sample size decreases, the heterogeneity of usage would vanish, and some local dependence structures would change.

Keywords: Heterogeneity; Two-dimensional data analysis; Copula; Global dependence; Local dependence (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0951832020308206
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:reensy:v:207:y:2021:i:c:s0951832020308206

DOI: 10.1016/j.ress.2020.107327

Access Statistics for this article

Reliability Engineering and System Safety is currently edited by Carlos Guedes Soares

More articles in Reliability Engineering and System Safety from Elsevier
Bibliographic data for series maintained by Catherine Liu ().