Some New Tests of Conformity with Benford’s Law

Roy Cerqueti and Claudio Lupi
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Roy Cerqueti: Department of Social and Economic Sciences, Sapienza University of Rome, P.le Aldo Moro 5, I-00185 Rome, Italy

Stats, 2021, vol. 4, issue 3, 1-17

Abstract: This paper presents new perspectives and methodological instruments for verifying the validity of Benford’s law for a large given dataset. To this aim, we first propose new general tests for checking the statistical conformity of a given dataset with a generic target distribution; we also provide the explicit representation of the asymptotic distributions of the relevant test statistics. Then, we discuss the applicability of such novel devices to the case of Benford’s law. We implement extensive Monte Carlo simulations to investigate the size and the power of the introduced tests. Finally, we discuss the challenging theme of interpreting, in a statistically reliable way, the conformity between two distributions in the presence of a large number of observations.

Keywords: Benford’s law; conformity tests; goodness-of-fit tests; Monte Carlo simulation; size–power graphs (search for similar items in EconPapers)
JEL-codes: C1 C10 C11 C14 C15 C16 (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)

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Related works:
Working Paper: Some New Tests of Conformity with Benford’s Laws (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:gam:jstats:v:4:y:2021:i:3:p:44-761:d:629818

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