The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Variance, Analysis Of

  • Andrew Gelman
Reference work entry


Analysis of variance (ANOVA) is a statistical procedure for summarizing a classical linear model – a decomposition of sum of squares into a component for each source of variation in the model – along with an associated test (the F-test) of the hypothesis that any given source of variation in the model is zero. More generally, the variance decomposition in ANOVA can be extended to obtain inference for the variances of batches of parameters (sources of variation) in multilevel regressions. ANOVA is a useful addition to regression in that it structures inferences about batches of parameters.


Analysis of variance (ANOVA) Balanced and unbalanced data Bayesian inference Classical linear models Classical method of moments Contrast analysis Experimental economics Finite-population standard deviation Fixed effects and random effects Generalized linear models Linear models Linear regression Multilevel models Nonexchangeable models Probability Super-population standard deviation Variance decomposition 

JEL classifications

C1 C3 
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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Andrew Gelman
    • 1
  1. 1.