Choosing the best dependent variable (Y)

Hello,

I'm working on a multiple regression model. The dependent variable (Y) is an ordered multinomial variable taking these values: A, B, C, D, E and F. The best value is A and the worst is F. In order to run a regression model, one needs to transform the letters (A, B, etc.) into figures.

I hereby ask you: which method between the following three is the best one? Linear transformation, Logistic Transformation and Exponential Transformation (each transformation method can have a logical explanation and a theoretical background)..

Example of figures which can be attributed to the different values of Y:

1. linear transformation : A=6, B=5,C=4.. F=1

2. logistic transformation: A=1, B=0,98, C=0,89, .. F=0.01

3. exponential transformation: A=10, B=8, C=5 .. F=1

Thanks.

Re: Choosing the best dependent variable (Y)

Hey goldenboy1.

If you are doing the transformation, the best thing is to plot the data first to see if the transformation is adequate.

Re: Choosing the best dependent variable (Y)

Hey chiro,

Thanks for your reply. What do you mean by plot the data?

I have a list of companies and their rankings. How to plot a plot and how to pick the best transformation method? I have a first idea which consists on:

1/ Make the regression using the three trans. methods

2/ Compute the residues --> The best trans. method is the one which minimizes the residues.

What do you think?

Re: Choosing the best dependent variable (Y)