Pearson’s Correlation Coefficient

Definition

Pearson's correlation coefficient (r) is a measure of the linear association of two variables. Correlation analysis usually starts with a graphical representation of the relation of data pairs using a scatter diagram. The values of correlation coefficient vary from –1 to +1. Positive values of correlation coefficient indicate a tendency of one variable to increase or decrease together with another variable. Negative values of correlation coefficient indicate a tendency that the increase of values of one variable is associated with the decrease of values of the other variable and vice versa. Values of correlation coefficient close to zero indicate a low association between variables, and those close to –1 or +1 indicate a strong linear association between two variables. The square of the correlation coefficient is the coefficient of determination, which gives the proportion of the variation in one variable that can be explained from the variation of the other variable. The...