Correlation
Correlation
Correlation
Correlation
key concepts:
Types of correlation
Methods of studying correlation
a) Scatter diagram
b) Karl pearson’s coefficient of correlation
c) Spearman’s Rank correlation coefficient
d) Method of least squares
Correlation
Correlation: The degree of relationship between the
variables under consideration is measure through the
correlation analysis.
The measure of correlation called the correlation coefficient
The degree of relationship is expressed by coefficient which
range from correlation ( -1 ≤ r ≥ +1)
The direction of change is indicated by a sign.
The correlation analysis enable us to have an idea about the
degree & direction of the relationship between the two
variables under study.
Correlation
Correlation is a statistical tool that helps
to measure and analyze the degree of
relationship between two variables.
Correlation analysis deals with the
association between two or more
variables.
Correlation & Causation
Causation means cause & effect relation.
Correlation denotes the interdependency among the
variables for correlating two phenomenon, it is essential
that the two phenomenon should have cause-effect
relationship,& if such relationship does not exist then the
two phenomenon can not be correlated.
If two variables vary in such a way that movement in one
are accompanied by movement in other, these variables
are called cause and effect relationship.
Causation always implies correlation but correlation does
not necessarily implies causation.
Types of Correlation
Type I
Correlation
Correlation
Simple Multiple
Partial Total
Types of Correlation Type II
Simple correlation: Under simple correlation
problem there are only two variables are studied.
Multiple Correlation: Under Multiple
Correlation three or more than three variables
are studied. Ex. Qd = f ( P,PC, PS, t, y )
Partial correlation: analysis recognizes more
than two variables but considers only two
variables keeping the other constant.
Total correlation: is based on all the relevant
variables, which is normally not feasible.
Types of Correlation
Type III
Correlation
Height
Height Height
of A of B
High Degree of positive correlation
Positive relationship
r = +.80
Weight
Height
Degree of correlation
Moderate Positive Correlation
r = + 0.4
Shoe
Size
Weight
Degree of correlation
Perfect Negative Correlation
r = -1.0
TV
watching
per
week
Exam score
Degree of correlation
Moderate Negative Correlation
r = -.80
TV
watching
per
week
Exam score
Degree of correlation
Weak negative Correlation
Shoe
r = - 0.2
Size
Weight
Degree of correlation
No Correlation (horizontal line)
r = 0.0
IQ
Height
Degree of correlation (r)
r = +.80 r = +.60
r = +.40 r = +.20
2) Direction of the Relationship
Positive relationship – Variables change in the
same direction.
Indicated by
As X is increasing, Y is increasing
As X is decreasing, Y is decreasing
sign; (+) or (-).
E.g., As height increases, so does weight.
Negative relationship – Variables change in
opposite directions.
As X is increasing, Y is decreasing
As X is decreasing, Y is increasing
E.g., As TV time increases, grades decrease
Advantages of Scatter Diagram
Simple & Non Mathematical method
Not influenced by the size of extreme
item
First step in investing the relationship
between two variables
Disadvantage of scatter diagram