The Multicollinearity Illusion in Moderated Regression Analysis

Marketing Letters, Forthcoming

Posted: 21 Nov 2014

See all articles by David Disatnik

David Disatnik

Tel Aviv University - Faculty of Management ; Tel Aviv University - Faculty of Management

Liron Sivan

Carnegie Mellon University - H. John Heinz III School of Public Policy and Management

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Date Written: November 21, 2014

Abstract

Numerous papers in the fields of marketing and consumer behavior that utilize moderated multiple regression express concerns regarding the existence of a multicollinearity problem in their analyses. In most cases, however, as we show in this paper, the perceived multicollinearity problem is merely an illusion that arises from misinterpreting high correlations between independent variables and interaction terms.

Keywords: Multicollinearity, Moderated Multiple Regression, Regression Analysis, Interaction

Suggested Citation

Disatnik, David J. and Disatnik, David J. and Sivan, Liron, The Multicollinearity Illusion in Moderated Regression Analysis (November 21, 2014). Marketing Letters, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2528942

David J. Disatnik (Contact Author)

Tel Aviv University - Faculty of Management ( email )

P.O. Box 39010
Ramat Aviv, Tel Aviv, 69978
Israel

Tel Aviv University - Faculty of Management ( email )

P.O. Box 39010
Ramat Aviv, Tel Aviv, 69978
Israel

Liron Sivan

Carnegie Mellon University - H. John Heinz III School of Public Policy and Management ( email )

Hamburg Hall
4800 Forbes Avenue
Pittsburgh, PA 15213
United States

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