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Easy Statistics: Linear and Non-Linear Regression
Rating: 4.4 out of 5(31 ratings)
266 students

Easy Statistics: Linear and Non-Linear Regression

An easy introduction to Ordinary Least Squares, Logit and Probit regression and tips for regression modelling.
Created byF. Buscha
Last updated 5/2021
English
English [Auto],

What you'll learn

  • The theory behind linear and non-linear regression analysis.
  • To be at ease with regression terminology.
  • The assumptions and requirements of Ordinary Least Squares (OLS) regression.
  • To comfortably interpret and analyse regression output from Ordinary Least Squares.
  • To learn and understand how Logit and Probit models work.
  • To learn tips and tricks around Non-Linear Regression analysis.
  • Practical examples in Stata

Course content

3 sections63 lectures5h 11m total length
  • What is Easy Statistics: Linear Regression?1:16

    Explore linear regression through intuitive concepts and practical interpretation, without equations or prior knowledge. Learn to read and apply statistical results with a gentle, practical approach.

  • What is Linear Regression?1:08

    Learn how linear regression uses ordinary least squares to relate one continuous variable to one or more continuous or categorical variables.

  • Learning Outcomes0:38

    Learn the basic intuition behind ordinary squares without complex equations, become comfortable with regression terminology and its assumptions, and gain tips for interpreting regression output.

  • Who is this Course for?0:42

    Explore who benefits from this course, including students at any level, business practitioners, managers, government analysts, and anyone seeking an easy introduction to linear regression.

  • Pre-requisites0:48

    No mathematics or statistics prerequisite is needed; curiosity suffices to follow this course. STATOR demonstrates regression models and shows how measurements relate by comparing quantitative variables.

  • Using Stata1:00

    Use Stata to demonstrate regression output interpretation, with do files and syntax sources to replicate on-screen results, using the auto training data set.

  • What is Regression Analysis?2:45

    Define regression analysis as a technique to explore relationships between a dependent variable and one or more independent variables, using terms like predictor, explanatory, and X.

  • What is Linear Regression?1:47

    Explore linear regression, focusing on linear relationships between X and Y using ordinary least squares, and how coefficients estimate parameters in simple and multiple regression.

  • Why is Regression Analysis Useful?1:36

    Regression analysis tests hypotheses with quantitative data and enables predictions by estimating parameters, computing expected wages, and assessing effects for samples and beyond.

  • What Types of Regression Analysis Exist?2:32

    Explore core regression methods by data type and dependent variable. Use ordinary least squares for continuous cross-sectional data, and non-linear models for binary, ordered, multinomial, panel, count, and hazard models.

  • Explaining Regression3:40
  • Lines of Best Fit7:58

    Explore lines of best fit by comparing parametric and non-parametric regression, including local polynomial regression and least squares, to model relationships from simple to multi-dimensional data.

  • Causality vs Correlation1:54

    Explore how regression analysis reveals relationships in data while distinguishing causality from correlation, and understand when time elements and cross-sectional settings affect causal inference.

  • What is Ordinary Least Squares?1:04

    Explore ordinary least squares as a regression method that minimizes sum of squared residuals to fit a line or plane of best fit, with least absolute deviations as an alternative.

  • Ordinary Least Squares Visual 14:14

    Visualize ordinary least squares by fitting a line of best fit to data, noting observed points, predicted values, and residuals, and how the slope minimizes the root mean square error.

  • Ordinary Least Squares Visual 27:38

    Explore how ordinary least squares regression outputs are interpreted, focusing on coefficient estimates for mpg and weight, standard errors, t statistics, p values, confidence intervals, and R-squared.

  • Sum of Squares3:12

    We examine the sum of squares in regression, including the explained, residual, and total variation, and relate them to R-squared and adjusted R-squared while noting R-squared can be easily abused.

  • Best Linear Unbiased Estimator4:44

    Explore how the best linear unbiased estimator arises under the ordinarily squares assumptions, compare efficient versus inefficient estimates, and show unbiasedness reduces long-run error.

  • The Gauss-Markov Assumptions0:41

    Explore the Gauss-Markov assumptions that ensure ordinary least squares yields an efficient, unbiased estimate by enforcing homoscedasticity, linearity, linear parameter assumption, and zero conditional mean.

  • Homoskedasticity2:13

    Explore homoskedasticity, where residual variance stays constant across X, and learn how violations affect standard errors and hypothesis testing, with robust standard errors offering resilience.

  • No Perfect Collinearity2:34

    No perfect collinearity means explanatory variables cannot be an exact linear combination of another. Partial correlation inflates standard errors and confidence intervals, but excluding or transforming variables can mitigate it.

  • Linear in Parameters2:43

    Explore how linear in parameters keeps coefficient estimates additive, while allowing nonlinear functional forms through transformations, polynomials, and interactions; see how a quadratic term can improve fit and affect residuals.

  • Zero Conditional Mean2:14

    Explore zero conditional mean, the no correlation between X and the error term, and how violation biases OLS coefficient estimates using a five-variable simulated data example.

  • How to Test and Correct for Endogeneity0:51

    Test for endogeneity and correct it with more data, better models, and different functional forms. Avoid data mining in ordinary least squares models to prevent bias in real-world results.

  • The Gauss-Markov Assumptions Recap1:56

    Recap Gauss-Markov assumptions for linear regression, including additive betas and continuous dependent variables, noting that Y–X need not be linear; remedies for violations include missing variables and robust standard errors.

  • Stata - Applied Examples21:32

    Explore applied regression in Stata using cars from 1978 to build models, diagnose changing variance, transform price with logs, and interpret effects of foreign, mpg, and weight.

  • Final Thoughts and Tips3:55

    Apply linear regression wisely by practicing with data, testing multiple models, considering interaction and quadratic terms, cleaning data, and using diagnostics to distinguish correlations from causation.

Requirements

  • None

Description

Make sure to check out my twitter feed for monthly promo codes and other updates (@easystats3)

Three courses combined. Linear and Non-Linear Regression and Regression Modelling.

Learning and applying new statistical techniques can often be a daunting experience.

"Easy Statistics" is designed to provide you with a compact, and easy to understand, course that focuses on the basic principles of statistical methodology.

This course will focus on the concept of linear regression, non-linear regression and regression modelling. Specifically Ordinary Least Squares, Logit and Probit Regression.

The first two parts will explain what regression is and how linear and non-liner regression works. It will examine how Ordinary Least Squares (OLS) works and how Logit and Probit models work. It will do this without any complicated equations or mathematics. The focus of this course is on application and interpretation of regression. The learning on this course is underpinned by animated graphics that demonstrate particular statistical concepts.

No prior knowledge is necessary and this course is for anyone who needs to engage with quantitative analysis.

The main learning outcomes are:

  1. To learn and understand the basic statistical intuition behind Ordinary Least Squares

  2. To be at ease with general regression terminology and the assumptions behind Ordinary Least Squares

  3. To be able to comfortably interpret and analyze complicated linear regression output from Ordinary Least Squares

  4. To learn tips and tricks around linear regression analysis

  5. To learn and understand the basic statistical intuition behind non-linear regression

  6. To learn and understand how Logit and Probit models work

  7. To be able to comfortably interpret and analyze complicated regression output from Logit and Probit regression

  8. To learn tips and tricks around non-linear Regression analysis

Specific topics that will be covered are:

  • What kinds of regression analysis exist

  • Correlation versus causation

  • Parametric and non-parametric lines of best fit

  • The least squares method

  • R-squared

  • Beta's, standard errors

  • T-statistics, p-values and confidence intervals

  • Best Linear Unbiased Estimator

  • The Gauss-Markov assumptions

  • Bias versus efficiency

  • Homoskedasticity

  • Collinearity

  • Functional form

  • Zero conditional mean

  • Regression in logs

  • Practical model building

  • Understanding regression output

  • Presenting regression output

  • What kinds of non-linear regression analysis exist

  • How does non-linear regression work?

  • Why is non-linear regression useful?

  • What is Maximum Likelihood?

  • The Linear Probability Model

  • Logit and Probit regression

  • Latent variables

  • Marginal effects

  • Dummy variables in Logit and Probit regression

  • Goodness-of-fit statistics

  • Odd-ratios for Logit models

  • Practical Logit and Probit model building in Stata

The computer software Stata will be used to demonstrate practical examples.

Regression Modelling

The third part provides useful practical tips for regression modelling.

Understanding how regression analysis works is only half the battle. There are many pitfalls to avoid and tricks to learn when modelling data in a regression setting. Often, it takes years of experience to accumulate these. In these sessions, we will examine some of the most common modelling issues. What is the theory behind them, what do they do and how can we deal with them? Each topic has a practical demonstration in Stata. Themes include:

  • Fundamental of Regression Modelling - What is the Philosophy?

  • Functional Form - How to Model Non-Linear Relationships in a Linear Regression

  • Interaction Effects - How to Use and Interpret Interaction Effects

  • Using Time - Exploring Dynamics Relationships with Time Information

  • Categorical Explanatory Variables - How to Code, Use and Interpret them

  • Dealing with Multicollinearity - Excluding and Transforming Collinear Variables

  • Dealing with Missing Data - How to See the Unseen

Who this course is for:

  • Academic students of any level.
  • Practitioners who require quantitative knowledge.
  • Business users and managers who engage with quantitative reports.
  • Government workers who are involved in policy analysis.
  • Anyone who has an interest in, or needs to engage, with statistical regression.