Question

Why did we not just use the Pearson correlation for the previous item? That is, what is the Pearson correlation influenced by that the Spearman is not?

Previous question-

Square footage (thousands)	Price of house thousands
2.7	478
2.3	328
2.3	309
1.8	298
1.9	303
2.1	466
1.4	328
1.6	385
2.1	360
2.9	374
2.2	387
2.6	452
2.1	462
1.8	436
1.9	424
0.95	308
1.3	430
1.9	449
2.2	325
1.2	358
1.4	467
1.8	489
1.2	485
1.1	450
1.4	353
1.8	358
2.3	443
1.7	422
1.3	368
1.5	416

data for the selling prices of homes in a ZIP code and the square footage of those homes. Use the Spearman rank correlation to determine if there is a significant correlation between the home price and the square footage.

Answer 1

The Spearman correlation evaluates the monotonic relationship between two continuous or ordinal variables. In a monotonic relationship, the variables tend to change together, but not necessarily at a constant rate. The Spearman correlation coefficient is based on the ranked values for each variable rather than the raw data.

Spearman correlation is often used to evaluate relationships involving ordinal variables.

In your problem, it is important to rank the data according to their selling price and the square footage of these homes. In other words, it is important to find the order in which price is related to the square footage of the homes.