Quantifying Proportional Variability

Joel P Heath and Peter Borowski

PLOS ONE, 2013, vol. 8, issue 12, 1-4

Abstract: Real quantities can undergo such a wide variety of dynamics that the mean is often a meaningless reference point for measuring variability. Despite their widespread application, techniques like the Coefficient of Variation are not truly proportional and exhibit pathological properties. The non-parametric measure Proportional Variability (PV) [1] resolves these issues and provides a robust way to summarize and compare variation in quantities exhibiting diverse dynamical behaviour. Instead of being based on deviation from an average value, variation is simply quantified by comparing the numbers to each other, requiring no assumptions about central tendency or underlying statistical distributions. While PV has been introduced before and has already been applied in various contexts to population dynamics, here we present a deeper analysis of this new measure, derive analytical expressions for the PV of several general distributions and present new comparisons with the Coefficient of Variation, demonstrating cases in which PV is the more favorable measure. We show that PV provides an easily interpretable approach for measuring and comparing variation that can be generally applied throughout the sciences, from contexts ranging from stock market stability to climate variation.

Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:plo:pone00:0084074

DOI: 10.1371/journal.pone.0084074

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