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Dissimilarities between categorical variables

Rodrigo Andrés Peñaloza ()

No 351, Working papers - Textos para Discussao do Departamento de Economia da Universidade de Brasilia from Departamento de Economia da Universidade de Brasilia

Abstract: When we deal with two categorical variables, Ginis index of distributional transvariation is a most usefull tool to measure the distributional difference between them. By means of a modi ed transvariation, which we call Euclidean transvari- ation, we showed that our measure of transvariation can be decomposed into the difference of two terms: a measure of categorical separation and the average variabil- ity. This decomposition allows us to view the dissimilarities between two categorical variables through three di¤erent lenses: distribution, modality, and variability. Fi- nally, by de ning a simpler measure of statistical dependence based on Pearsons X2, we prove a relationship between statistical dependence and the transvariational impact of one variable onto another.

Keywords: nominal variables; transvariation; degree of dependence (search for similar items in EconPapers)
JEL-codes: C49 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ecm
Date: 2011-01
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