Discussion #3 (OPTION 2) - Case Study Critique for Predicting Overvalued / Undervalued Airlines (Chap 9 reading)

This discussion assumes you have read Chapter 9 (pp. 257-276) of Welc & Esquerdo (2018) on predicting overvalued / undervalued airlines. If you have not read this chapter, please do so now. Otherwise, you may join this discussion. Your task for this discussion is to use critical thinking skills about data and modeling to critique the Overvalued / Undervalued Airlines case study. You should address such issues as:

A. Do you clearly understand how the data was obtained? What is the population for this data? Is the data a sample or a census?

B. Can the data be considered a Random Sample? Does this random sample permit generalization of the modeling results? What exactly is the population to which generalization is permitted?

C. Does the response variable Y make sense? Should they be using something else that would be more apropos to the goal of the study purpose statement?

D. Examine the explanatory variables. For each of these variables, consider if a 1 unit change makes sense and is interpretable. Is it reasonable to assume that any change in Y would be interpreted the same way across every possible 1 unit change in each X variable?

E. Does the model include categorical variables and are they handled correctly using dummy coded variables? If not, can you envision some categorical variable(s) that may be highly related to the response variable? What are they?

F. Does the author(s) utilize interaction in the model? If not, can you envision a case for interaction? Discuss how big of an issue this might be for prediction.

G. The author(s) use a number of hypothesis tests in this write-up. Is there anything random about this data that justifies the use of hypothesis tests? Or, are these "overkill"? Are the authors being complete and thorough, or are they bullying and coercing your acceptance of their authority?

H. What about the final model? Too many variables? Not enough? Has parsimony won the day? Does the final model feel right or politically motivated?

I. Was this modeling approach an exemplar of what you should do or is it the exact opposite? Maybe something in between? Synthesize your discussion into a final position about this case study.

You are encouraged to look for materials outside of our course readings to help support your arguments. Please be sure to cite any sources you utilize in your posts.