Incremental effect modeling by area index maximization
First Claim
1. An incremental effect modeling apparatus comprising:
- a computing device processor;
a storage device; and
an incremental effect modeling application stored in said storage device and configured for operation on said computing device processor, said application configured to;
determine a set of model variables from a plurality of predictor variables that are decision relevant and optionally time invariant, wherein the predictor variables are associated with a response variable or a performance variable and a decision variable for a population, wherein the decision variable defines treated observations and control observations in the population;
determine a function describing a relationship between an incremental effect and the model variable, wherein the incremental effect is defined as the difference between performance of an individual under treatment and the performance of the individual under no treatment;
rank order the treated and control observations in the population based on a score from low to high, wherein the score is a weighted sum of a set of functions created from the model variables;
determine a cumulative incremental effect at increasing percentages of ranked observations with the lowest score values, based on the combined test and control data;
determine an incremental effect area index based on the cumulative incremental effect as a function of the increasing percentages of ranked observations with the lowest score values; and
iterate through the functions of the model variables for weight searching until the incremental effect area index is maximized to determine the incremental effect model.
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Abstract
How much is the net benefit of treating an individual: cost-effective, very small, or even negative? To address this question, a methodology for developing an incremental effect model based on randomized test data is provided. The concept of an incremental effect area index is introduced for measuring the model'"'"'s quality. A new variable screening technique is proposed to identify variables that are decision relevant and preferably time invariant. A piecewise linear function is created for each continuous variable to approximate the relationship between the incremental effect and the variable, based on a binning technique. Finally, a score is created as the weighted sum of a set of functions, with each function being the empirical prediction of the incremental effect based on a variable, wherein weights are chosen to maximize the incremental effect area index. The methodology creates an improved incremental effect model, leading to more cost-effective strategies in business practice.
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Citations
20 Claims
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1. An incremental effect modeling apparatus comprising:
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a computing device processor; a storage device; and an incremental effect modeling application stored in said storage device and configured for operation on said computing device processor, said application configured to; determine a set of model variables from a plurality of predictor variables that are decision relevant and optionally time invariant, wherein the predictor variables are associated with a response variable or a performance variable and a decision variable for a population, wherein the decision variable defines treated observations and control observations in the population; determine a function describing a relationship between an incremental effect and the model variable, wherein the incremental effect is defined as the difference between performance of an individual under treatment and the performance of the individual under no treatment; rank order the treated and control observations in the population based on a score from low to high, wherein the score is a weighted sum of a set of functions created from the model variables; determine a cumulative incremental effect at increasing percentages of ranked observations with the lowest score values, based on the combined test and control data; determine an incremental effect area index based on the cumulative incremental effect as a function of the increasing percentages of ranked observations with the lowest score values; and iterate through the functions of the model variables for weight searching until the incremental effect area index is maximized to determine the incremental effect model. - View Dependent Claims (2, 3, 4, 5, 6, 7, 8, 9)
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10. A computer program product for determining an incremental effect model, the computer program product comprising:
a non-transitory computer-readable medium comprising; an executable portion for causing a computer to determine at least one model variable from a plurality of predictor variables, wherein the model variable is associated with a response variable or a performance variable and a decision variable for a population, wherein the decision variable defines treated observations and control observations in the population; an executable portion for causing a computer to determine a difference in the response variable between the treated observations and the control observations; an executable portion for causing a computer to determine a function describing the relationship between the difference and the model variable; an executable portion for causing a computer to rank order the treated and control observations in the population based on a score, which is a weighted sum of functions of some model variables; an executable portion for causing a computer to determine a cumulative incremental effect between the response value for the treated and control observations at increasing percentages of ranked observations with the lowest score values; an executable portion for causing a computer to determine an incremental effect area index based on the cumulative incremental effect as a function of the increasing percentages of ranked observations with the lowest score values; and an executable portion for causing a computer to iterate through the functions of the model variables until the incremental effect area index is maximized to determine the incremental effect model. - View Dependent Claims (11, 12, 13, 14, 15, 16, 17)
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18. A computer-implemented method of determining an incremental effect model, the method comprising:
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determine a set of model variables from a plurality of predictor variables that are decision relevant and optionally time invariant, wherein the predictor variables are associated with a response variable or a performance variable and a decision variable for a population, wherein the decision variable defines treated observations and control observations in the population; determine a function describing the relationship between an incremental effect and the model variable, wherein the incremental effect is defined as the difference between performance of an individual under treatment and the performance of the individual under no treatment; rank order the treated and control observations in the population based on a score from low to high, wherein the score is a weighted sum of a set of functions created from the model variables; determine a cumulative incremental effect at increasing percentages of ranked observations with the lowest score values, based on the combined test and control data; determine an incremental effect area index based on the cumulative incremental effect as a function of the increasing percentages of ranked observations with the lowest score values; and iterate through the functions of the model variables for weight search until the incremental effect area index is maximized to determine an incremental effect model; rank ordering the model variables based on a significance value for a two-term interaction between the decision variable and a predictor variable; determining a function describing the relationship between the incremental effect and the model variable. - View Dependent Claims (19, 20)
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Specification