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Home→The Westburn Dictionary of Marketing→P→Pearson correlation coefficient

Pearson correlation coefficient

Definition:
(Pearson product-moment correlation). A statistic to indicate the association between two interval or ratio variables. The basis of FACTOR ANALYSIS is a matrix of correlation coefficients. It is calculated as the cross-product (sum of the product of one score with the other over cases) of the standardized variables scaled by dividing by the product of the variances of the two variables, and ranges from -1 (perfect negative correlation) through zero to + 1 (perfect positive correlation). Generally a higher positive correlation indicates an increasing tendency for increases in one variable to be associated with an increase in the other variable.

Cross-References:
[factor analysis]

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© Westburn Publishers Ltd 2002, The Westburn Dictionary of Marketing edited by Michael J Baker, ISBN 978-0-946433-01-8. www.themarketingdictionary.com. Entry: [Stephen K. Tagg], [1998].