TESTS OF ASSOCIATION
• CORRELATION
• REGRESSION
CORRELATION ANALYSIS
• This is one of the measures of association in
statistics.
• It is used to quantify the association between
two continuous variables (e.g., between an
independent and a dependent variable or
between two independent variables).
• In correlation analysis, we estimate a sample correlation
coefficient
• The sample correlation coefficient, denoted r, ranges
between -1 and +1 and quantifies the direction and
strength of the linear association between the two
variables.
• The correlation between two variables can be positive
(i.e., higher levels of one variable are associated with
higher levels of the other) or negative (i.e., higher levels
of one variable are associated with lower levels of the
other).
• The sign of the correlation coefficient indicates the
direction of the association. The magnitude of the
correlation coefficient indicates the strength of the
association.
• For example, a correlation of r = +0.9 suggests a strong,
positive association between two variables, whereas a
correlation of r = -0.2 suggest a weak, negative
association. A correlation close to zero suggests no linear
association between two continuous variables.
• It is important to note that there may be a non-linear
association between two continuous variables, but
computation of a correlation coefficient does not detect
this. Therefore, it is always important to evaluate the
data carefully before computing a correlation
coefficient. Graphical displays are particularly useful to
explore associations between variables.
• The figure below shows four hypothetical scenarios in
which one continuous variable is plotted along the X-
axis and the other along the Y-axis.
• Scenario 1 depicts a strong positive association (r=0.9),
similar to what we might see for the correlation
between infant birth weight and birth length.
• Scenario 2 depicts a weaker association (r=0.2) that we
might expect to see between age and body mass index
(which tends to increase with age).
• Scenario 3 might depict the lack of association (r
approximately 0) between the extent of media exposure
in adolescence and age at which adolescents initiate
sexual activity.
• Scenario 4 might depict the strong negative association
(r= -0.9) generally observed between the number of
hours of aerobic exercise per week and percent body
fat.
Example - Correlation of Gestational Age and Birth
Weight
• This table
shows the data
from a small
study involving
17 infants to
investigate the
association
between
gestational age
at birth (weeks),
and birth weight
(grams).
• We wish to estimate the
association between
gestational age and
infant birth weight. In
this example, birth
weight is the
dependent variable and
gestational age is the
independent variable.
Thus y=birth weight
and x=gestational age.
The data are displayed
in a scatter diagram in
the figure.
• Each point represents an (x,y) pair (in this case the
gestational age, measured in weeks, and the birth
weight, measured in grams).
• Note that the independent variable is on the
horizontal axis (or X-axis), and the dependent
variable is on the vertical axis (or Y-axis).
• The scatter plot shows a positive or direct association
between gestational age and birth weight.
• Infants with shorter gestational ages are more likely
to be born with lower weights and infants with longer
gestational ages are more likely to be born with
higher weights.
• As we noted, sample correlation coefficients
range from -1 to +1. In practice, meaningful
correlations (i.e., correlations that are clinically
or practically important) can be as small as 0.4
(or -0.4) for positive (or negative) associations.
Assumptions made in calculation of
‘r’
1. Subjects selected for study with pair of values
of X & Y are chosen with random sampling
technique.
2. Both X & Y variables are continuous and are
assumed to follow normal distribution.
REGRESSION ANALYSIS
• Regression analysis is a related technique to
assess the relationship between an outcome
variable and one or more risk factors or
confounding variables.
• The outcome variable is also called the response or
dependent variable and the risk factors and
confounders are called the predictors, or
explanatory or independent variables.
• In regression analysis, the dependent variable is
denoted "y" and the independent variables are
denoted by "x".
• Regression means change in the measurements
of one variable on the positive or negative side
beyond the mean.
• Regression coefficient (b) is a measure of the
change in one dependent character (Y) with one
unit change in the independent character (X).
• Regression analysis enables us to predict the
values of one variable on the basis of another
variable.
• The equation for simple linear regression is
given as;
• Y = a + bX
• Where,
• Y = Dependent variable
• X = Independent variable
• a=intercept
• b=slope
• Regression analysis includes several variations,
such as linear, multiple linear, and nonlinear. The
most common models are simple linear and
multiple linear. Nonlinear regression analysis is
commonly used for more complicated data sets in
which the dependent and independent variables
show a nonlinear relationship.
• Regression analysis offers numerous applications
in various disciplines, including finance.
Comparison Between Correlation and Regression
