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How to choose which transformation to use while using Regression Model
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| Published: |
Nov 20, 2008 |
| Length: |
22 |
| Type: |
whitepaper |
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Taking transformation of variables is quite common practice while building model. In real life scenario some time it becomes evident to take variable transformation to improve the model performance. One can try out what ever transformation one want to take but that should be logical and meaningful with respect to business sense and value addition due to use of transformation needs to be significant with respect to no transformation situation i.e. if the transformation is adding marginal value in terms of explanatory power then the original variable is recommended. In this writing we will discuss some techniques to choose one transformation among many others. We will also discuss sanity checks that we need to go through.
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