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LOS 8.b: Interpret estimated regression READING 8: MULTIPLE REGRESSION AND ISSUES IN REGRESSION ANALYSIS
coefficients and their p-values
MODULE 8.1: MULTIPLE REGRESSION: INTRODUCTION
Interpreting the Multiple Regression Results
Interpreting multiple regression coefficients is same as in simple linear regression for the intercept but very different for the
slope coefficients:
• Intercept term = value of the dependent variable when the independent variables are all equal to zero.
• Slope coefficient/s = ∆ in the dependent variable for a one-unit ∆ in that independent variable (citeris paribus,
hence also called partial slope coefficients)
For example, Suppose Y = 2.0 + 4.5X1, then If X1 increases by 1 unit, we would expect Y to increase by 4.5 units.
What happened to coefficient of X1?
Now suppose we add X2 as next independent variable, we get: Y = 1.0 + 2.5X1 + 6.0X2
It dropped from 4.5 to 2.5!
Each time you add another variable, the whole equation interacts/recalibrates (assuming obviously, that X1 and X2 are
related); New interpretation?
If X1 increases by 1 unit, we would expect Y to increase by 2.5 units, holding X2 constant.
