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Technical Note—The Effect of Grouping Continuous Variables on Correlation Coefficients

Donald G. Morrison and Norman E. Toy
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Donald G. Morrison: Graduate School of Business, Columbia University, New York, New York 10027
Norman E. Toy: College of Physicians and Surgeons, Columbia University, New York, New York 10032

Marketing Science, 1982, vol. 1, issue 4, 379-389

Abstract: The purpose of this note is to supplement some recent articles which discuss correlations between two grouped random variables. In this paper we give a more parsimonious and less computationally complex method of assessing the effect of grouping while also giving some insights into the best ways to group continuous variables. Implications of these results for certain marketing studies are given.

Keywords: discrete variable; optimal grouping; correlation (search for similar items in EconPapers)
Date: 1982
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