Proxy (statistics) explained

In statistics, a proxy variable is something that is probably not in itself of any great interest, but from which a variable of interest can be obtained. In order for this to be the case, the proxy variable must have a close correlation, not necessarily linear or positive, with the inferred value.

Examples

Per-capita GDP is often used as a proxy for measures of standard of living or quality of life.

Likewise, country of origin or birthplace might be used as a proxy for race.

See also

• Instrumental variable
• Proxy (climate)

References

• Toutenburg. Helge. Götz Trenkler. Proxy variables and mean square error dominance in linear regression. Journal of Quantitative Economics. 8. 433-442. 1992.
• Stahlecker. Peter. Götz Trenkler. Some further results on the use of proxy variables in prediction. The Review of Economics and Statistics. 75. 707-711. The MIT Press. 1993.
• Trenkler. Götz. Peter Stahlecker. Dropping variables versus use of proxy variables in linear regression. Journal of Statistical Planning and Inference. 50. 1. 65–75. NORTH-HOLLAND. 1996. 10.1016/0378-3758(95)00045-3.