# Statistical Language - Correlation and Causation

Why are correlation and causation important?The objective of much research or scientific analysis is to identify the extent to which one variable relates to another variable. For example: - Is there a relationship between a person's education level and their health?
- Is pet ownership associated with living longer?
- Did a company's marketing campaign increase their product sales?
These and other questions are exploring whether a correlation exists between the two variables, and if there is a correlation then this may guide further research into investigating whether one action causes the other. By understanding correlation and causality, it allows for policies and programs that aim to bring about a desired outcome to be better targeted. How is correlation measured?For two variables, a statistical correlation is measured by the use of a Correlation Coefficient, represented by the symbol (r), which is a single number that describes the degree of relationship between two variables. The coefficient's numerical value ranges from +1.0 to –1.0, which provides an indication of the strength and direction of the relationship. If the correlation coefficient has a negative value (below 0) it indicates a negative relationship between the variables. This means that the variables move in opposite directions (ie when one increases the other decreases, or when one decreases the other increases). If the correlation coefficient has a positive value (above 0) it indicates a positive relationship between the variables meaning that both variables move in tandem, i.e. as one variable decreases the other also decreases, or when one variable increases the other also increases. Where the correlation coefficient is 0 this indicates there is no relationship between the variables (one variable can remain constant while the other increases or decreases). While the correlation coefficient is a useful measure, it has its limitations: How can causation be established?Causality is the area of statistics that is commonly misunderstood and misused by people in the mistaken belief that because the data shows a correlation that there is necessarily an underlying causal relationship The use of a controlled study is the most effective way of establishing causality between variables. In a controlled study, the sample or population is split in two, with both groups being comparable in almost every way. The two groups then receive different treatments, and the outcomes of each group are assessed. For example, in medical research, one group may receive a placebo while the other group is given a new type of medication. If the two groups have noticeably different outcomes, the different experiences may have caused the different outcomes. Due to ethical reasons, there are limits to the use of controlled studies; it would not be appropriate to use two comparable groups and have one of them undergo a harmful activity while the other does not. To overcome this situation, observational studies are often used to investigate correlation and causation for the population of interest. The studies can look at the groups' behaviours and outcomes and observe any changes over time. The objective of these studies is to provide statistical information to add to the other sources of information that would be required for the process of establishing whether or not causality exists between two variables. Return to Statistical Language Homepage Further informationABS:1500.0 - A guide for using statistics for evidence based policy |