Finicade
Data Apprentice Lv 1
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Level 10 · ◆◆◆ · ~12 min

Dummy Variables

Dummy Variables

"Put categories — sex, region, industry, treated-or-not — into a regression as 0/1 switches, and read each coefficient as a group difference."

binary (dummy) regressorsbase/reference groupintercept shift = group differencemultiple categories and the dummy trap
🚀 You're jumping ahead. This builds on Omitted Variable Bias — but play it now and you'll still earn full XP. If it feels steep, those make a gentler on-ramp.

A short lesson, then a quiz. ❤️×3 — a wrong answer costs a heart; finish with at least one left and the level is yours. Lose all three and you'll have to try again. Replay any time — XP and cleared levels are never lost.