Timeline for Is a log transformation of predictors a suitable way of dealing with multicollinearity in multiple regression?
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| Jul 26, 2013 at 1:27 | comment | added | user28479 | Thanks for your answers. I take logs of those variables to improve their distribution characteristics (both are highly positively skewed). They both seem to have positive impact on dependent variable in single regressions. When entered both into the same regression, one of them changes sign to minus. Can it be some kind of omitted variable bias? Since when we control for first variable, second one changes sign to negative? And once again, there is non-zero covariance between them. | |
| Jul 26, 2013 at 1:12 | comment | added | whuber♦ | +1 But there's a more benign explanation for the reduction in correlation with the logs: please see stats.stackexchange.com/questions/41734/…. No "strangeness" is needed in the distributions, only a small difference in standard deviations. | |
| Jul 26, 2013 at 1:01 | history | answered | Jeremy Miles | CC BY-SA 3.0 |