Statistical Modeling

The previous chapter covered basic statistical concepts and methods. This chapter builds on the foundation laid out in the last chapter and explores statistical modeling, which deals with creating models that attempt to explain data. A model can have one or several parameters, and we can use a fitting procedure to find the parameter values so that the model best describes the observed data. Once a model has been fitted to data, it can be used to predict the values of new observations, given the values of the model’s independent variables. We can also perform statistical analysis on the data and the fitted model and try to answer questions such as if the model accurately explains the data, which factors in the model are more relevant (predictive) than others, and if there are parameters that do not contribute significantly to the predictive power of the model.