Title: Nominal and ordinal variables
Course: UGQuants (SSPS) > Section: Multiple Regression

Nominal and ordinal variables

While multiple linear regression is a powerful technique, it is not without some disadvantages for social scientists, one of which is that it can only be used with interval or ratio level dependent (Y) variables.

However, independent nominal and ordinal variables (X) can be used as long as they are first transformed into 'dummy' variables, typically taking the values of 0 or 1.  We will see how we can do this shortly.  When the dependent variable we want to focus on is not an interval or ratio variable, however, all is not lost.  In this circumstance we can use techniques like logistic regression, which is the subject of the next module.