Bayesian Superiority in On/Off analysis

Abstract

We present a detailed comparison of Bayesian criteria with three non-informative priors - flat, Jeffreys, and scale-invariant - for testing a signal against an unknown background and compare them with the classical frequentist Li-Ma approach in the On/Off problem. We perform Monte Carlo simulations for various background levels and evaluate the Li-Ma and Bayesian criteria by their Type I error rates. We then simulate a nonzero signal and compare the criteria in terms of Type II error rates. We find that the Bayesian criterion with the Jeffreys prior yields lower Type I and Type II error rates than the Li-Ma criterion. In addition, we show that the Bayesian criteria are more robust than the Li-Ma criterion when the background distribution is overdispersed relative to the Poisson distribution.