statistics Statistics (from German: '' Statistik'', "description of a state, a country") is the discipline that concerns the collection, organization, analysis, interpretation, and presentation of data. In applying statistics to a scientific, indust ...

, a proxy or proxy variable is a variable that is not in itself directly relevant, but that serves in place of an unobservable or immeasurable variable. In order for a variable to be a good proxy, it must have a close

correlation In statistics, correlation or dependence is any statistical relationship, whether causal or not, between two random variables or bivariate data. Although in the broadest sense, "correlation" may indicate any type of association, in statistic ...

, not necessarily linear, with the variable of interest. This correlation might be either positive or negative. Proxy variable must relate to an unobserved variable, must correlate with disturbance, and must not correlate with regressors once the disturbance is controlled for.

Examples

social science Social science is one of the branches of science, devoted to the study of societies and the relationships among individuals within those societies. The term was formerly used to refer to the field of sociology, the original "science of s ...

s, proxy measurements are often required to stand in for variables that cannot be directly measured. This process of standing in is also known as operationalization. Per-capita

gross domestic product Gross domestic product (GDP) is a monetary measure of the market value of all the final goods and services produced and sold (not resold) in a specific time period by countries. Due to its complex and subjective nature this measure is of ...

(GDP) is often used as a proxy for measures of

standard of living Standard of living is the level of income, comforts and services available, generally applied to a society or location, rather than to an individual. Standard of living is relevant because it is considered to contribute to an individual's quality ...

quality of life Quality of life (QOL) is defined by the World Health Organization as "an individual's perception of their position in life in the context of the culture and value systems in which they live and in relation to their goals, expectations, standards ...

. Montgomery ''et al.'' examine several proxies used, and point out limitations with each, stating "In poor countries, no single empirical measure can be expected to display all of the facets of the concept of income. Our judgment is that consumption per adult is the best measure among those collected in cross-sectional surveys." Likewise, country of origin or birthplace might be used as a proxy for race, or vice versa. Frost lists several examples of proxy variables:Jim Frost
Proxy Variables: The Good Twin of Confounding Variables
22 September 2011 (retrieved 9 Nov. 2015) Widths of tree rings: proxy for historical environmental conditions; Per-capita GDP: proxy for quality of life;

body mass index Body mass index (BMI) is a value derived from the mass ( weight) and height of a person. The BMI is defined as the body mass divided by the square of the body height, and is expressed in units of kg/m2, resulting from mass in kilograms and ...

(BMI): proxy for true body fat percentage; years of education and/or GPA: proxy for cognitive ability; satellite images of ocean surface color: proxy for depth that light penetrates into the ocean over large areas; changes in height over a fixed time: proxy for hormone levels in blood.

References

* * * Statistical analysis {{econometrics-stub

Examples

See also

References