Distance metric choice can both reduce and induce collinearity in geographically weighted regression

Alexis Comber, Khanh Chi, Man Q Huy, Quan Nguyen, Binbin Lu, Hoang H Phe and Paul Harris
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Alexis Comber: University of Leeds, UK
Khanh Chi: GeoViet Consulting Co. Ltd, Vietnam
Man Q Huy: Vietnam National University, Vietnam
Quan Nguyen: National University of Civil Engineering, Vietnam
Binbin Lu: Wuhan University, China
Hoang H Phe: Vinaconex R&D, Vietnam

Environment and Planning B, 2020, vol. 47, issue 3, 489-507

Abstract: This paper explores the impact of different distance metrics on collinearity in local regression models such as geographically weighted regression. Using a case study of house price data collected in Hà Nội, Vietnam, and by fully varying both power and rotation parameters to create different Minkowski distances, the analysis shows that local collinearity can be both negatively and positively affected by distance metric choice. The Minkowski distance that maximised collinearity in a geographically weighted regression was approximate to a Manhattan distance with (power =  0.70 ) with a rotation of 30°, and that which minimised collinearity was parameterised with power  = 0.05 and a rotation of 70 °. The results indicate that distance metric choice can provide a useful extra tuning component to address local collinearity issues in spatially varying coefficient modelling and that understanding the interaction of distance metric and collinearity can provide insight into the nature and structure of the data relationships. The discussion considers first, the exploration and selection of different distance metrics to minimise collinearity as an alternative to localised ridge regression, lasso and elastic net approaches. Second, it discusses the how distance metric choice could extend the methods that additionally optimise local model fit (lasso and elastic net) by selecting a distance metric that further helped minimise local collinearity. Third, it identifies the need to investigate the relationship between kernel bandwidth, distance metrics and collinearity as an area of further work.

Keywords: Geographically weighted regression; distance metrics; model fit; collinearity (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:sae:envirb:v:47:y:2020:i:3:p:489-507

DOI: 10.1177/2399808318784017

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