Classical error pairs and the Bayesian prior

Journal of the Academy of Marketing Science · 1973 · Volume 1 · Issue 1

Abstract

We have attempted to show the way in which Bayesian and classical approaches are both similar and divergent. The vehicle for discussion, primarily, involved considerations of cost consequences, planning horizons and numbers of alternatives. In turn, these variables were related to the statistical problem continuum, with classical and Bayesian approaches at opposite ends of the scale. By relating problem variables to this continuum, the question of which approach is most appropriate in a particular situation can be more readily resolved.

Keywords

Prior Distribution, Planning Horizon, Expected Loss, Cost Consequence, Composite Hypothesis

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