You are on page 1of 8

Advanced Regression

Nega)ve
Poisson Binomial
Regression

Zero Inflated

ial
Mul)nom
n
Regressio

AGENDA

© 2013 ExcelR Solutions. All Rights Reserved


Multinomial Regression
•  Logis'c regression (Binomial distribu'on) is used when output has ‘2’ categories

•  Mul'nomial regression (classifica'on model) is used when output has > ‘2’ categories

•  Extension to logis'c regression



•  No natural ordering of categories

Mode of
Car Carpool Bus Rail All modes
transport

Count 218 32 81 122 453

•  Response variable has > ‘2’ categories & hence we apply mul'logit
Probability 0.48 0.07 0.18 0.27 1

•  Understand the impact of cost & 'me on the various modes of transport

© 2013 ExcelR Solutions. All Rights Reserved


Multinomial Regression

•  Whether we have ‘Y’ (response) or ‘X’ (predictor), which is categorical with ‘s’ categories
ü  Lowest in numerical / lexicographical value is chosen as baseline / reference
ü  Missing level in output is baseline level
ü  We can choose the baseline level of our choice based on ‘relevel’ func'on in R
ü  Model formulates the rela'onship between transformed (logit) Y & numerical X linearly
ü  Modeling quan'ta've variables linearly might not always be correct

© 2013 ExcelR Solutions. All Rights Reserved


Multinomial Regression - Output
Itera'on History:
•  Itera've procedure is used to compute maximum likelihood es'mates
•  # itera'ons & convergence status is provided
•  -2logL = 2 * nega've log likelihood
•  -2logL has χ2 distribu'on, which is used for hypothesis tes'ng of goodness of fit

# parameters = 27

© 2013 ExcelR Solutions. All Rights Reserved


Multinomial Regression - Output
•  ‘car’ has been chosen as baseline

•  x = vector represen'ng the values of all inputs

Log(P(choice = carpool | x) / P(choice = car | x) = β20 + β21 * cost.car + β22 * cost.carpool + …………….

This equa'on compares the log of probabili'es of carpool to car

•  The regression coefficient 0.636 indicates that for a ‘1’ unit increases the ‘cost.car’, the log odds of ‘carpool’ to ‘car’
increases by 0.636

•  Intercept value does not mean anything in this context



•  If we have a categorical X also, say Gender (female = 0, male = 1), then regression coefficient (say 0.22) indicates
that rela've to females, males increase the log odds of ‘carpool’ to ‘car’ by 0.22

© 2013 ExcelR Solutions. All Rights Reserved


Probability
•  Let p = p(x | A) be the probability of any event (say airi'on) under condi'on A (say
gender = female)

Odds

•  Then p(x | A) ÷ (1 - p(x | A) is called the odds associated with the event

Odds Ratio
•  If there are two condi'ons A (gender = female) & B (gender = male) then the ra'o
p(x | A) ÷ (1 - p(x | A) / p(x | B) ÷ (1 - p(x | B) is called as odds ra'o of A with respect to B

Relative Risk
•  p(x | A) ÷ p(x | B) is called as rela've risk

hips://en.wikipedia.org/wiki/Rela've_risk
© 2013 ExcelR Solutions. All Rights Reserved
Odds Ratio
•  Odds ra'o is computed from the coefficients in the linear model equa'on by simply
exponen'a'ng

•  Exponen'ated regression coefficients are odds ra'o for a unit change in a predictor
variable

•  The odds ra'o for a unit increase in cost.car is 1.88 for choosing carpool vs car

© 2013 ExcelR Solutions. All Rights Reserved


Goodness of fit

Linear GLM
Analysis of Variance Analysis of Deviance
Residual Deviance Residual Sum of Squares
OLS Maximum Likelihood

•  Residual Deviance is -2 log L


•  Adding more parameters to the model will reduce Residual Deviance even if it is not
going to be useful for predic'on
•  In order to control this, penalty of “2 * number of parameters” is added to to
Residual deviance
•  This penalized value of -2 log L is called as AIC criterion
•  AIC = -2 log L + 2 * number of parameters

Note: “Mul'logit Model with Interac(on”

© 2013 ExcelR Solutions. All Rights Reserved