Factor Analysis Part-I by Vikramjit Singh
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This presentation is on the basic idea of Factor Analysis
Factor Analysis Part-I by Vikramjit Singh
- 1. —Dr. V. Singh, PhD FACTOR ANALYSIS-I Basic concept
- 2. - Factor analysis is a statistical method used to describe variability among observed, correlated variables in terms of a potentially lower number of unobserved variables called factors. For example, it is possible that variations in six observed variables mainly reflect the variations in two unobserved (underlying) variables. Definition of FA
- 3. -Variable Reduction Technique -Produces a set of variable in terms of a small number of latent factors -FA is a correlational method used to find and describe the underlying factors driving data values for a largest set of variables - Factor analysis is an interdependence technique whose primary purpose is to define the underlying structure among the variables in the analysis Basic Idea on FA
- 4. -FA is used to condense the information contained in a number of original variables into a smaller set of new composite dimensions or variates(factors) with a minimum loss of information. -Method for investigating the structure underlying variables(or people, or time) - A mathematical model used to express observations in terms of latent variables. Basic Idea on FA
- 5. -FA is a significant instrument which is utilized in development, refinement and evaluation of tests, scales, and measures(Williams, Brown et al. 2010). -FA has origins dating back more than 100 years through the work of Pearson and Spearman(Spearman,1904). -FA can be used while preparing tests, scale and questionnaire as well while establishing the validity of a pre-established relationship between a set of variables. Basic Idea on FA
- 6. - FA is as much of a "test" as MR(multiple regression) in that it is used to reveal hidden or latent relationships or groupings in one's dataset. - FA and MR both are based on the basics statistics of correlation - To create a set of factors to be treated as uncorrelated variable. Basic Idea on FA
- 7. - FA is used to reduce a large number of variable to a smaller no. of factors for modelling purposes. As such FA is integrated in structural equation modelling(SEM). - To select a subset of variables from a large set based on which original variable have the highest correlations with the principal component factors. Basic Idea on FA
- 8. - Factor Analysis explains variability among observed random variables in terms of fewer unobserved random variables called factors. The observed variables are expressed in terms of linear combination of the factors, plus “error’ terms. Factor Analysis is originated in psychometrics, and is used in social sciences, marketing, product management, operations research, and other applied sciences that deal with large quantities of data. Basic Idea on FA
- 9. - No outliers in the data set. - Normality of the data set. - Adequacy of the sample size. (KMO test) - Multi-collinearity and singularity among the variables does not exist. - Since factor analysis is a linear function of measured variables, it does not require homoscedasticity between the variables Assumption for FA
- 10. - Variables should be linear in nature. - Data should be metric in nature i.e. interval and ratio scale. - Variables must be sufficiently intercorrelated to produce representative factors. - Using Bartlett test of sphericity should hold. - The data collected should be from a homogeneous sample. - sample size include from 3 to 20 times the number of variables and absolute ranges from 100 to over 1,000. Assumption for FA
- 11. - Confirmatory FA(CFA) - Exploratory FA(EFA) Types of FA
- 12. - Confirmatory FA seeks to determine if the number of factors and the loadings of measures(indicators) variables on them conform to what is expected on the basis of pre- established theory. Types of FA-CFA
- 13. - Exploratory FA is used to uncover the underlying structure of a relatively large set of variables. This is the most common form of factor analysis. Types of FA-EFA
- 19. In this presentation we developed a brief idea on basic idea of FA , assumption before performing FA and also the steps of performing FA Conclusion
- 20. Thanks E-mail: drvsinghonline@gmail.com Mob: +91-9438574139 © V. Singh © V. Singh