MULTIVARIATE ANALYSIS

What is multivariate analysis?

Comprises a set of techniques dedicated to the analysis

of data sets with more than one variable

Usefulness of multivariate analysis

Business research usually involve situations that require

the study of more than two variables. Thus study of univariate or bivariate statistical analysis is not enough. What is required to handle such real life complex situation is mutivariate techniques. this leads us to the discussion of Multivariate analysis

Types of multivariate techniques

Dependency techniques- techniques that deal with

problems involving one or more dependent variables while the remaining variables are independent Interdependency techniques- techniques that deal with problems involving more than two variables where the variables are not segregated as dependent variables & independent variables. These aim at analyzing interrelationships among variables

Dependency Techniques
Explains or predicts one or more dependent variables

based on two or more independent variables Defines relationship between one dependent variable and many independent variables Example: to what extent is the demand for a particular product explained by factors like, price of the product, income of the prospective consumer, advertisement of the product etc.

Multivariate techniques
Multivariate techniques
Are some variables dependent on others

Yes Dependency Methods How many dependent vars one Is data metric? Is data metric? Factor analysis Cluster analysis

No Interdependency Methods Is data metric?

many

Yes

No Non Metric Multi dimensional scaling

Yes Multiple Regression

No

Yes

No MANOVA

Metric Multidimensional scaling

Discriminant Analysis

Canonical Correlation Analysis

Different Dependency Techniques

Multiple Regression

Discriminant analysis
MANOVA Cannonical Correlation Analysis

Criteria for selecting a techniques

Number of dependent variables

Measurement scale used

Criteria for selecting a techniquecontd..

Multiple Regression- if one dependent variable &

measurement scale used is interval or ratio scale Discriminant analysis - if one dependent variable & measurement scale used is non-metric i.e. ordinal or nominal MANOVA if more than one and scale is metric Cannonical Correlation Analysis- if more than one and scale is non-metric

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Interdependency techniques
Applied in situations where no distinction is made

between independent & dependent variables Interdependent relationships between variables are examined

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Different Interdependency techniques

Factor analysis

Cluster analysis
Metric multidimensional analysis Non Metric multidimensional analysis

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Criteria for selecting a techniques

Measurement scale used

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Criteria for selecting a techniquescontd..

Factor analysis if measurement scale used is metric

Cluster analysis - if measurement scale used is metric

Metric multidimensional analysis- if measurement scale

used is metric Non Metric multidimensional analysis - if measurement scale used is non-metric

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