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# Data Distribution

Updated on December 8, 2023
Article byPrakhar Gajendrakar
Edited byShreeya Jain
Reviewed byDheeraj Vaidya, CFA, FRM

## What Is Data Distribution?

Data distribution refers to the way data values are spread or distributed in a dataset. It aims at providing valuable insights, informs decision-making, and ensures that appropriate methods are used for statistical analysis and modeling.

For eg:
Source: Data Distribution (wallstreetmojo.com)

Data distribution in statistics is any population with data scattering or a spread of a range of values. Statistics typically use various representations, such as charts, tables, histograms, and box plots. With proper distribution, the raw data becomes more accessible to read and interpret.

### Key Takeaways

• Data distribution is the process of turning raw data into meaningful information through graphical representation methods.
• Based on continuous and discrete data, it has different types of distribution used in different models of calculations.
• The key purpose of this is to estimate the probability of an event occurring with respect to different factors and represent it for further analysis.
• Various fields of work, including science, business, finance, weather forecasting, and population analysis, use this distribution.

### Data Distribution Explained

Data distribution refers to the representation of data points scattered or clustered around with specific values and quantitative ranges. When joining the data points together, they typically create a shape that expresses a pattern following the underlying factor. Moreover, it provides insights into the patterns, central tendencies, and variability of the data. There are several types of data distribution. Each of these has its properties and applications with a scope in different fields of work and analysis. In statistics, the fundamental aspect is data, and proper distribution of data enables obtaining meaningful interpretations or desired results.

Furthermore, the shapes of data distribution can be symmetrical or asymmetrical. A typical example of symmetry is a normal distribution, while an asymmetric distribution is considered skewed. Only the comprehension of these distributions helps firms, analysts, and researchers gain insights into customer trends, financial forecasting, scientific anomalies, and marketing performance. In addition, outliners can impact the interpretation of the distribution and may indicate errors or exceptional circumstances.

Hence, successfully fitting information into proper distribution helps researchers identify patterns, trends, and past anomalies. This identification forms the basis for assessing the future shift or variability of the underlying factor. Therefore, it is possible in both traditional and modern ways of determination. However, R, Python, and machine learning lead to expensive models and packages with complex calculations. Researchers commonly use visualization tools and statistical measures to explore and describe data distributions.

### Types

Data distribution can be divided into two types:

#### #1 – Continuous Data

In simple terms, such data operates from one extreme to another, gauged on a scale such as weight and temperature. Such type of data helps in gaining relevant information into trends, patterns, and relationships typically not observed with other datasets. The continuous data is categorized into several distributions, such as –

1. Normal data distribution – This is the most common type of distribution, with a bell curve measuring the mean between equal data points on both sides.
2. Log-normal distribution – In this distribution, the data points are measured in a sigmoid function. Hence, this distribution is used in financial data to predict future stock prices based on past data.
3. F distribution: Helps in gauging data points in a broader range than normal distribution with high variability.
4. Chi-square distribution: It analyzes the gap between observed data and expected results and helps in identifying differences between two datasets.
5. Exponential distribution: Similar to F distribution, but gauges data points with an exponential curve beginning at zero and perpetually increasing in value.
6. Non-normal distribution: It includes logistic and gamma distribution. Moreover, it is usually used when data is highly non-linear and does not fit in the standard data distribution categories.

#### #2 – Discrete Data

It is the opposite of continuous data, which means that it varies in limit and a set range of values. Examples of it are classroom strength, books in a shop, etc. Such information is generally visualized through bar graphs. It has four types of distribution.

1. Binomial distribution: Applied to describe the quantified success or failure probability in a given number of trials. For example, yes or no, heads or tails, right or wrong, etc.
2. Poisson data distribution: Used to define the event probability during a specific period with a known rate but unknown occurrence.
3. Hypergeometric distribution: Similar to binomial distribution but with multiple items and without replacement.
4. Geometric distribution: Derives a number of failures before a success. The success probability is defined in any given trial with a series of independent trials and known individual success probability.

### Examples

Below are two hypothetical examples of data distribution –

#### Example #1

Consider a dataset that represents the annual incomes of residents in a suburban neighborhood. Upon analyzing the data, it was observed a right-skewed distribution, indicating that the majority of residents have incomes clustered toward the lower end, while a smaller number enjoy higher incomes. The median income, which represents the middle point when the incomes are arranged in ascending order, is notably lower than the mean income, suggesting the presence of a few high earners pulling the average upward.

Hence, the histogram of the income data reveals a long tail on the right side, indicating that there are relatively few individuals with significantly higher incomes than the rest of the population. Therefore, this distribution shape is typical in income data, reflecting economic disparities within the community. Understanding this method is crucial for policymakers, social planners, and researchers, as it provides insights into the income landscape of the neighborhood and helps identify areas where economic interventions or support may be needed.

#### Example #2

Suppose a town has a railway crossing. Every day between 8 AM to 1 PM, nine trains pass through the crossing and disrupt the traffic. During these five hours, the traffic is usually at its peak, and the trains passing through cause a huge jam. The trains are often running late, so there is no fixed time for them to cross.

Again, in this scenario, no two trains can cross at the same time; the period is given five hours, and the number of trains nine is also provided (events occurring). The rate remains constant. By applying the Poisson distribution, the probability of trains crossing and the intervals between them can be calculated. In this distribution example, each train is treated as an independent variable. Here, it can help the traffic control authority to measure the probability, and it can help them in clearing the traffic jams and eventually help the people reach their destination on time.

• Helps in probability distribution and estimation of an event occurrence.
• Derives the time interval between two events occurring within a specified period.
• The frequency data distribution displays both relative and absolute frequencies.
• In statistics, different distribution techniques can help in testing hypotheses.
• Provides accurate results with reliability based on the data set size.

• It requires heavy sets of data for accurate results.
• The model structuring needs to be correct depending on the analysis’s objective.
• Here, the whole process in Python and machine learning is expensive and time-consuming.
• Some of these may require an advanced level of knowledge for understanding.

### Data Distribution vs Sampling Distribution

The main differences between data distribution and sampling distribution are –

• It is the observation distribution of data points on the original dataset. In comparison, sampling distribution is the outcome of repeated sampling of a specific dataset.
• These can have infinite values in variables, but sampling distribution typically has a finite number of variables and, therefore, operates within a range of values.
• It is also called population distribution. In contrast, sampling distribution is also referred to as finite sample distribution.
• It provides insights into the characteristics of the entire dataset. At the same time, sampling distribution is used to make inferences about the population based on sample data.

1. What are the main features of data distribution?

It operates as a function to indicate all possible values for a variable. The main features of data distribution are variability, shape, and central tendency. The latter defines a single value for the entire distribution, mainly given by mean, median, and mode. The shape is used to represent the skewness, and the variability describes the spread-out degree through quantitative methods.

2. Why is data distribution important in machine learning?

The use of this in machine learning is significant because it helps in model selection, checking normality, generalization strategies, picking up the right statistical tests, decision-making processes, performance evaluation, visualizing data, and preprocessing techniques.

3. What is the process of data distribution?

The process of understanding and analyzing this involves several steps. Here is a general outline of the data distribution process:
– Data collection
– It includes data entry and cleaning
– Data visualization
– Outliner detection
– Interpretation
– Documentation

This article has been a guide to what is Data Distribution. We explain its types, examples, comparison with sampling distribution, advantages, and disadvantages. You may also find some useful articles here –