# Boolean Dummy Indicator Variable

(Redirected from Indicator Variable)

A Boolean Dummy Indicator Variable is a boolean learning task variable that takes only the value 0 or 1 to indicate the absence (or presence) of some categorical effect that may be expected to change an outcome.

## References

### 2022

• (Wikipedia, 2022) ⇒ https://en.wikipedia.org/wiki/Dummy_variable_(statistics) Retrieved:2022-8-14.
• In statistics and econometrics, particularly in regression analysis, a dummy variable is one that takes only the value 0 or 1 to indicate the absence or presence of some categorical effect that may be expected to shift the outcome. [1] They can be thought of as numeric stand-ins for qualitative facts in a regression model, sorting data into mutually exclusive categories (such as smoker and non-smoker).[2] A dummy independent variable (also called a dummy explanatory variable) which for some observation has a value of 0 will cause that variable's coefficient to have no role in influencing the dependent variable, while when the dummy takes on a value 1 its coefficient acts to alter the intercept. For example, suppose membership in a group is one of the qualitative variables relevant to a regression. If group membership is arbitrarily assigned the value of 1, then all others would get the value 0. Then the intercept would be the constant term for non-members but would be the constant term plus the coefficient of the membership dummy in the case of group members.

Dummy variables are used frequently in time series analysis with regime switching, seasonal analysis and qualitative data applications.

1. "Interpreting the Coefficients on Dummy Variables" (PDF). Archived from the original (PDF) on August 18, 2003.
2. Gujarati, Damodar N. (2003). Basic Econometrics. McGraw Hill. ISBN 0-07-233542-4.