Centered and non-centered variance inflation factor

TL;DR

This paper compares centered and non-centered Variance Inflation Factors (VIFs) in diagnosing multicollinearity in multiple linear regression, providing formulas relating both approaches and enhancing diagnostic understanding.

Contribution

It introduces a new expression linking centered and non-centered VIFs, improving multicollinearity diagnostics in regression analysis.

Findings

Derived an expression relating centered and non-centered VIFs

Enhanced understanding of multicollinearity diagnostics

Provided formulas for auxiliary regressions

Abstract

This paper analyzes the diagnostic of near multicollinearity in a multiple linear regression from auxiliary centered regressions (with intercept) and non-centered (without intercept). From these auxiliary regression, the centered and non-centered Variance Inflation Factors are calculated, respectively. It is also presented an expression that relate both of them.