Freakonomics

When looking at statistical data over a period of time, what does “correlation” mean? How is it different from “causation?”

When looking at statistical data over a period of time, what does “correlation” mean? How is it different from “causation?”

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From the text:

“A regression analysis can demonstrate correlation, but it doesn’t prove cause. After all, there are several ways in which two variables can be correlated. X can cause Y; Y can cause X; or it may be that some other factor is causing both X and Y. A regression alone can’t tell you whether it snows because it’s cold, whether it’s cold because it snows, or if the two just happen to go together.”

Correlation:

Correlation is when two or more things or events tend to occur at about the same time and might be associated with each other, but aren't necessarily connected by a cause/effect relationship.

Causation:

A specific action caused a second event to happen.

Source(s)

Freakonomics, Page 163; Kip Wheeler, University of Oregon