Free Ebook

A Compendium of Probability Distributions

The precision of a risk analysis relies very heavily on the appropriate use of probability distributions to accurately represent the uncertainty and variability of the problem. In our experience, inappropriate use of probability distributions has proved to be a very common failure of risk analysis models. It stems, in part, from an inadequate understanding of the theory behind probability distribution functions and, in part, from failing to appreciate the knock-on effects of using inappropriate distributions. This ebook is intended to alleviate the misunderstanding by providing a practical insight into the various types of probability distributions in common use.

This ebook gives a very complete summary of the distributions used in risk analysis, an explanation of where and why they are used, some representative plots and the most useful descriptive formulae from a risk analysis viewpoint. The distributions are given in alphabetical order. The list comprises most of the distributions that are included in ModelRisk.

This ebook starts with a list of different applications, and the distributions that you might find most useful. Then it offers a little guide on how to read the probability equations that feature so prominently in this ebook: people’s eyes tend to glaze over when they see probability equations but with a few simple rules you will be able to rapidly ‘read’ the relevant parts of an equation and ignore the rest, which can give you a much more intuitive feel for a distribution’s behavior.

Please note that this ebook is adapted from "Risk Analysis: a Quantitative Guide 3rd edition" by David Vose. Published by John Wiley and Sons (2008).

Referencing this document

Please use the following reference, following the Harvard system of referencing:
Van Hauwermeiren M and Vose D (2009). A Compendium of Distributions. [ebook]. Vose Software, Ghent, Belgium. Available from www.vosesoftware.com. Accessed dd/mm/yy