TY - JOUR
T1 - Multicollinearity in marketing models
T2 - Diagnostics and remedial measures
AU - Ofir, Chezy
AU - Khuri, André
PY - 1986
Y1 - 1986
N2 - The problem of multicollinearity in linear models is reviewed. Diagnostic measures for detection, analysis of the effects, and localization of multicollinearity are presented. It is recommended that OLS estimates should not be used without a proper diagnostic. The traditional remedial measures, i.e., omission of variables from the model and principal component regression, are critically discussed along with more recent methods. Ridge regression is presented, and several methods for selecting the biasing parameter in ridge regression are introduced. The procedures are illustrated with data taken from the marketing literature and evaluated for their potential usefulness in handling multicollinearity.
AB - The problem of multicollinearity in linear models is reviewed. Diagnostic measures for detection, analysis of the effects, and localization of multicollinearity are presented. It is recommended that OLS estimates should not be used without a proper diagnostic. The traditional remedial measures, i.e., omission of variables from the model and principal component regression, are critically discussed along with more recent methods. Ridge regression is presented, and several methods for selecting the biasing parameter in ridge regression are introduced. The procedures are illustrated with data taken from the marketing literature and evaluated for their potential usefulness in handling multicollinearity.
UR - http://www.scopus.com/inward/record.url?scp=38249041841&partnerID=8YFLogxK
U2 - 10.1016/0167-8116(86)90023-6
DO - 10.1016/0167-8116(86)90023-6
M3 - ???researchoutput.researchoutputtypes.contributiontojournal.article???
AN - SCOPUS:38249041841
SN - 0167-8116
VL - 3
SP - 181
EP - 205
JO - International Journal of Research in Marketing
JF - International Journal of Research in Marketing
IS - 3
ER -