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Fundamentals of Bayesian Data Analysis in R

Rasmus Bååth

Data Scientist

A probability distribution over an interesting parameter

Fundamentals of Bayesian Data Analysis in R

A probability distribution over an interesting parameter

Fundamentals of Bayesian Data Analysis in R

A probability distribution over an interesting parameter

Fundamentals of Bayesian Data Analysis in R

A probability distribution over an interesting parameter

Fundamentals of Bayesian Data Analysis in R

Next up on reasons to use Bayesian data analysis

  1. You can include information sources in addition to the data.
  2. You can make any comparisons between groups or data sets.
  3. You can use the result of a Bayesian analysis to do Decision Analysis.
  4. You can change the underlying statistical model.
Fundamentals of Bayesian Data Analysis in R

Fundamentals of Bayesian Data Analysis in R

Fundamentals of Bayesian Data Analysis in R

A small decision analysis

video_cost <- 0.25
text_cost <- 0.05
visitor_spend <- 2.53
Fundamentals of Bayesian Data Analysis in R
video_cost <- 0.25
text_cost <- 0.05
visitor_spend <- 2.53
posterior

   video_prop text_prop 
1        0.08      0.10 
2        0.10      0.07 
3        0.16      0.05 
4        0.09      0.05  
5        0.18      0.03 
6        0.13      0.05  
7        0.12      0.10  
8        0.10      0.04 
9        0.11      0.09
10       0.18      0.05
11       0.12      0.04
12       0.13      0.07
Fundamentals of Bayesian Data Analysis in R
video_cost <- 0.25
text_cost <- 0.05
visitor_spend <- 2.53  
posterior$video_profit <- posterior$video_prop * visitor_spend - video_cost
posterior

   video_prop text_prop video_profit 
1        0.08      0.10        -0.04 
2        0.10      0.07         0.00  
3        0.16      0.05         0.15 
4        0.09      0.05        -0.02 
5        0.18      0.03         0.21
6        0.13      0.05         0.08 
7        0.12      0.10         0.06
8        0.10      0.04         0.01
9        0.11      0.09         0.02
10       0.18      0.05         0.21
11       0.12      0.04         0.06
12       0.13      0.07         0.08
Fundamentals of Bayesian Data Analysis in R
video_cost <- 0.25
text_cost <- 0.05
visitor_spend <- 2.53
posterior$video_profit <- posterior$video_prop * visitor_spend - video_cost
posterior$text_profit <-posterior$text_prop * visitor_spend - text_cost
posterior

   video_prop text_prop video_profit text_profit 
1        0.08      0.10        -0.04        0.21
2        0.10      0.07         0.00        0.12
3        0.16      0.05         0.15        0.09
4        0.09      0.05        -0.02        0.08
5        0.18      0.03         0.21        0.02
6        0.13      0.05         0.08        0.09
7        0.12      0.10         0.06        0.20
8        0.10      0.04         0.01        0.05
9        0.11      0.09         0.02        0.17
10       0.18      0.05         0.21        0.09
11       0.12      0.04         0.06        0.05
12       0.13      0.07         0.08        0.12
Fundamentals of Bayesian Data Analysis in R
video_cost <- 0.25
text_cost <- 0.05
visitor_spend <- 2.53
posterior$video_profit <- posterior$video_prop * visitor_spend - video_cost
posterior$text_profit <-posterior$text_prop * visitor_spend - text_cost
posterior$profit_diff <- posterior$video_profit - posterior$text_profit
posterior
   video_prop text_prop video_profit text_profit profit_diff
1        0.08      0.10        -0.04        0.21       -0.26
2        0.10      0.07         0.00        0.12       -0.12
3        0.16      0.05         0.15        0.09        0.07
4        0.09      0.05        -0.02        0.08       -0.10
5        0.18      0.03         0.21        0.02        0.18
6        0.13      0.05         0.08        0.09        0.00
7        0.12      0.10         0.06        0.20       -0.14 
8        0.10      0.04         0.01        0.05       -0.04 
9        0.11      0.09         0.02        0.17       -0.15
10       0.18      0.05         0.21        0.09        0.12
11       0.12      0.04         0.06        0.05        0.00
12       0.13      0.07         0.08        0.12       -0.04
Fundamentals of Bayesian Data Analysis in R

Make a data informed decision!

Fundamentals of Bayesian Data Analysis in R

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