turn on suggestions

Auto-suggest helps you quickly narrow down your search results by suggesting possible matches as you type.

Showing results for

- JMP User Community
- :
- Discussions
- :
- Correlation of estimates

Topic Options

- Subscribe to RSS Feed
- Mark Topic as New
- Mark Topic as Read
- Float this Topic for Current User
- Bookmark
- Subscribe
- Printer Friendly Page

- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Get Direct Link
- Email to a Friend
- Report Inappropriate Content

Nov 8, 2010 9:19 AM
(922 views)

Thanks.

4 REPLIES

- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Get Direct Link
- Email to a Friend
- Report Inappropriate Content

Nov 8, 2010 9:37 AM
(651 views)

It means that you can't interpret the individual estimates by themselves. The prediction model is still fine, just the estimates are not easily interpretable.

If, for example, beta1 is estimated to be 3 and beta2 is estimated to be 1, then you canNOT say that a one unit change in x1 results in a 3 unit change in Y, because x1 and x2 are correlated, so when x1 changes by 1 unit, x2 is also changing.

What can be done? Remove one (or more) of the highly correlated X's from the model, and adjust your mindset to use the prediction model without trying to interpret the coefficients.

- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Get Direct Link
- Email to a Friend
- Report Inappropriate Content

Nov 8, 2010 9:53 AM
(651 views)

Thanks a lot.

Can you give me rough numbers, what high correlation means?

Can you give me rough numbers, what high correlation means?

- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Get Direct Link
- Email to a Friend
- Report Inappropriate Content

Nov 8, 2010 10:53 AM
(651 views)

No, it depends on the situation and the use you are planning to make of the numbers.

- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Get Direct Link
- Email to a Friend
- Report Inappropriate Content

Mar 20, 2012 10:25 AM
(651 views)