IDEAS home Printed from https://ideas.repec.org/a/abg/anprac/v25y2021i11425.html
   My bibliography  Save this article

Cluster Analysis in Practice: Dealing with Outliers in Managerial Research

Author

Listed:
  • Humberto Elias Garcia Lopes
  • Marlusa de Sevilha Gosling

Abstract

Context: in recent years, cluster analysis has stimulated researchers to explore new ways to understand data behavior. The computational ease of this method and its ability to generate consistent outputs, even in small datasets, explain that to some extent. However, researchers are often mistaken in holding that clustering is a terrain in which anything goes. The literature shows the opposite: they must be careful, especially regarding the effect of outliers on cluster formation. Objective: in this tutorial paper, we contribute to this discussion by presenting four clustering techniques and their respective advantages and disadvantages in the treatment of outliers. Methods: for that, we worked from a managerial dataset and analyzed it using k-means, PAM, DBSCAN, and FCM techniques. Results: our analyzes indicate that researchers have distinct clustering techniques for dealing with outliers accordingly.Conclusion: we concluded that researchers need to have a more diversified repertoire of clustering techniques. After all, this would give them two relevant empirical alternatives: choose the most appropriate technique for their research objectives or adopt a multi-method approach.

Suggested Citation

  • Humberto Elias Garcia Lopes & Marlusa de Sevilha Gosling, 2021. "Cluster Analysis in Practice: Dealing with Outliers in Managerial Research," RAC - Revista de Administração Contemporânea (Journal of Contemporary Administration), ANPAD - Associação Nacional de Pós-Graduação e Pesquisa em Administração, vol. 25(1), pages 200081-2000.
  • Handle: RePEc:abg:anprac:v:25:y:2021:i:1:1425
    as

    Download full text from publisher

    File URL: https://rac.anpad.org.br/index.php/rac/article/view/1425
    Download Restriction: no

    File URL: https://rac.anpad.org.br/index.php/rac/article/download/1425/1523/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. John Adams & Darren Hayunga & Sattar Mansi & David Reeb & Vincenzo Verardi, 2019. "Identifying and treating outliers in finance," Financial Management, Financial Management Association International, vol. 48(2), pages 345-384, June.
    2. J. A. Hartigan & M. A. Wong, 1979. "A K‐Means Clustering Algorithm," Journal of the Royal Statistical Society Series C, Royal Statistical Society, vol. 28(1), pages 100-108, March.
    3. Taweh Beysolow II, 2017. "Introduction to Deep Learning Using R," Springer Books, Springer, number 978-1-4842-2734-3, June.
    4. Nicola Loperfido, 2020. "Kurtosis-based projection pursuit for outlier detection in financial time series," The European Journal of Finance, Taylor & Francis Journals, vol. 26(2-3), pages 142-164, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Francisco Antonio García Márquez & María del Carmen Pérez Gónzález & Francisco Javier Maza Ávila, 2024. "El Gasto Público Y El Esfuerzo Empresarial En El Deporte Y Su Relación Con El Desarrollo Territorial: El Caso De Las Comunidades Autónomas Españolas," Revista de Estudios Regionales, Universidades Públicas de Andalucía, vol. 1, pages 157-191.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wan, Heyang & Qi, Hongwei & Shang, Songhao, 2023. "Estimating soil water and salt contents from field measurements with time domain reflectometry using machine learning algorithms," Agricultural Water Management, Elsevier, vol. 285(C).
    2. Custodio João, Igor & Lucas, André & Schaumburg, Julia & Schwaab, Bernd, 2023. "Dynamic clustering of multivariate panel data," Journal of Econometrics, Elsevier, vol. 237(2).
    3. Xu, Jing & Wang, Xiaoying & Gu, Yujiong & Ma, Suxia, 2023. "A data-based day-ahead scheduling optimization approach for regional integrated energy systems with varying operating conditions," Energy, Elsevier, vol. 283(C).
    4. Carlos Carrasco-Farré, 2022. "The fingerprints of misinformation: how deceptive content differs from reliable sources in terms of cognitive effort and appeal to emotions," Palgrave Communications, Palgrave Macmillan, vol. 9(1), pages 1-18, December.
    5. Albert J. Menkveld & Anna Dreber & Felix Holzmeister & Juergen Huber & Magnus Johannesson & Michael Kirchler & Sebastian Neusüß & Michael Razen & Utz Weitzel & David Abad‐Díaz & Menachem (Meni) Abudy , 2024. "Nonstandard Errors," Journal of Finance, American Finance Association, vol. 79(3), pages 2339-2390, June.
      • Albert J. Menkveld & Anna Dreber & Félix Holzmeister & Juergen Huber & Magnus Johannesson & Michael Kirchler & Sebastian Neusüss & Michael Razen & Utz Weitzel & Gunther Capelle-Blancard, 2021. "Non-Standard Errors," Documents de travail du Centre d'Economie de la Sorbonne 21033, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
      • Moinas, Sophie & Declerck, Fany & Menkveld, Albert J. & Dreber, Anna, 2023. "Non-Standard Errors," TSE Working Papers 23-1451, Toulouse School of Economics (TSE).
      • Albert J. Menkveld & Anna Dreber & Felix Holzmeister & Juergen Huber & Magnus Johannesson & Michael Kirchler & Sebastian Neussüs & Michael Razen & Utz Weitzel & Christian Brownlees & Javier Gil-Bazo, 2021. "Non-Standard Errors," Working Papers 1303, Barcelona School of Economics.
      • Menkveld, Albert J. & Dreber, Anna & Holzmeister, Felix & Huber, Jürgen & Johannesson, Magnus & Kirchler, Michael & Neusüss, Sebastian & Razen, Michael & Weitzel, Utz, 2021. "Non-standard errors," IWH Discussion Papers 11/2021, Halle Institute for Economic Research (IWH).
      • Albert J. Menkveld & Anna Dreber & Felix Holzmeister & Juergen Huber & Magnus Johannesson & Michael Kirchler & Sebastian Neussüs & Michael Razen & Utz Weitzel & Christian T. Brownlees & Javier Gil-Baz, 2021. "Non-standard errors," Economics Working Papers 1807, Department of Economics and Business, Universitat Pompeu Fabra.
      • Menkveld, Albert J. & Dreber, Anna & Holzmeister, Felix & Huber, Juergen & Johannesson, Magnus & Kirchler, Michael & Neusüss, Sebastian & Razen, Michael & Weitzel, Utz & Abad-Díaz, David & Abudy, Mena, 2021. "Non-Standard Errors," Working Papers 2021:17, Lund University, Department of Economics.
      • Albert J. et al. Menkveld, 2021. "Non-Standard Errors," CESifo Working Paper Series 9453, CESifo.
      • Albert J Menkveld & Anna Dreber & Felix Holzmeister & Juergen Huber & Magnus Johannesson & Michael Kirchler & Sebastian Neusüss & Michael Razen & Utz Weitzel & Gunther Capelle-Blancard & David Abad-Dí, 2021. "Non-Standard Errors," Post-Print halshs-03500882, HAL.
      • Menkveld, Albert J. & Dreber, Anna & Holzmeister, Felix & Huber, Juergen & Johannesson, Magnus & Hasse, Jean-Baptiste & e.a.,, 2023. "Non-Standard Errors," LIDAM Reprints LFIN 2023002, Université catholique de Louvain, Louvain Finance (LFIN).
      • Albert J. Menkveld & Anna Dreber & Felix Holzmeister & Juergen Huber & Magnus Johannesson & Michael Kirchler & Sebastian Neusüss & Michael Razen & Utz Weitzel & Edwin Baidoo & Michael Frömmel & et al, 2021. "Non-Standard Errors," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 21/1032, Ghent University, Faculty of Economics and Business Administration.
      • Menkveld, Albert J. & Dreber, Anna & Holzmeister, Felix & Huber, Juergen & Johannesson, Magnus & Kirchler, Michael & Neusüß, Sebastian & Razen, Michael & Weitzel, Utz & Abad-Díaz, David & Abudy, Menac, 2024. "Nonstandard errors," LSE Research Online Documents on Economics 123002, London School of Economics and Political Science, LSE Library.
      • Menkveld, A. & Dreber, A. & Holzmeister, F. & Huber, J. & Johannesson, M. & Kirchler, M. & Neusüss, S. & Razen, M. & Neusüss, S. & Neusüss, S., 2021. "Non-Standard Errors," Cambridge Working Papers in Economics 2182, Faculty of Economics, University of Cambridge.
      • Menkveld, Albert J. & Dreber, Anna & Holzmeister, Felix & Huber, Jürgen & Johannesson, Magnus & Kirchler, Michael & Neusüss, Sebastian & Razen, Michael & Weitzel, Utz, 2021. "Non-standard errors," SAFE Working Paper Series 327, Leibniz Institute for Financial Research SAFE.
      • Albert J. Menkveld & Anna Dreber & Felix Holzmeister & Jürgen Huber & Magnus Johannesson & Michael Kirchler & Sebastian Neusüss & Michael Razen & Utz Weitzel & David Abad-Dí­az & Menachem Abudy & Tobi, 2021. "Non-Standard Errors," Working Papers 2021-31, Faculty of Economics and Statistics, Universität Innsbruck.
      • Albert J Menkveld & Anna Dreber & Felix Holzmeister & Juergen Huber & Magnus Johannesson & Michael Kirchler & Sebastian Neusüss & Michael Razen & Utz Weitzel & Gunther Capelle-Blancard & David Abad-Dí, 2021. "Non-Standard Errors," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-03500882, HAL.
      • Wolff, Christian & Menkveld, Albert J. & Dreber, Anna & Holzmeister, Felix & Huber, Juergen & Johannesson, Magnus & Kirchler, Michael & Neusüess, Sebastian & Razen, Michael & Weitzel, Utz, 2021. "Non-Standard Errors," CEPR Discussion Papers 16751, C.E.P.R. Discussion Papers.
      • Menkveld, A. & Dreber, A. & Holzmeister, F. & Huber, J. & Johannesson, M. & Kirchler, M. & Neusüss, S. & Razen, M. & Neusüss, S. & Neusüss, S., 2021. "Non-Standard Errors," Janeway Institute Working Papers 2112, Faculty of Economics, University of Cambridge.
    6. Roberto Benocci & Giovanni Brambilla & Alessandro Bisceglie & Giovanni Zambon, 2020. "Eco-Acoustic Indices to Evaluate Soundscape Degradation Due to Human Intrusion," Sustainability, MDPI, vol. 12(24), pages 1-19, December.
    7. Felix Mbuga & Cristina Tortora, 2021. "Spectral Clustering of Mixed-Type Data," Stats, MDPI, vol. 5(1), pages 1-11, December.
    8. Emma L. Schultz & David T. Tan & Kathleen D. Walsh, 2010. "Endogeneity and the corporate governance - performance relation," Australian Journal of Management, Australian School of Business, vol. 35(2), pages 145-163, August.
    9. Loperfido, Nicola, 2021. "Some theoretical properties of two kurtosis matrices, with application to invariant coordinate selection," Journal of Multivariate Analysis, Elsevier, vol. 186(C).
    10. Muxuan Pan & Hao Wang & Jinquan Huang, 2019. "T–S Fuzzy Modeling for Aircraft Engines: The Clustering and Identification Approach," Energies, MDPI, vol. 12(17), pages 1-15, August.
    11. Zhang, Weibin & Zha, Huazhu & Zhang, Shuai & Ma, Lei, 2023. "Road section traffic flow prediction method based on the traffic factor state network," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 618(C).
    12. Jian Guo & Saizhuo Wang & Lionel M. Ni & Heung-Yeung Shum, 2022. "Quant 4.0: Engineering Quantitative Investment with Automated, Explainable and Knowledge-driven Artificial Intelligence," Papers 2301.04020, arXiv.org.
    13. Ting Liu & Nick Shryane & Mark Elliot, 2022. "Attitudes to climate change risk: classification of and transitions in the UK population between 2012 and 2020," Palgrave Communications, Palgrave Macmillan, vol. 9(1), pages 1-15, December.
    14. Byers, J.W. & Popova, I. & Simkins, B.J., 2021. "Robust estimation of conditional risk measures using machine learning algorithm for commodity futures prices in the presence of outliers," Journal of Commodity Markets, Elsevier, vol. 24(C).
    15. Yan, Yu & Qi, Shusen, 2021. "Childhood matters: Family education and financial inclusion," Pacific-Basin Finance Journal, Elsevier, vol. 65(C).
    16. Renata De Paris & Christian V Quevedo & Duncan D A Ruiz & Osmar Norberto de Souza, 2015. "An Effective Approach for Clustering InhA Molecular Dynamics Trajectory Using Substrate-Binding Cavity Features," PLOS ONE, Public Library of Science, vol. 10(7), pages 1-25, July.
    17. Michal Bernardelli & Zbigniew Korzeb & Pawel Niedziolka, 2021. "The banking sector as the absorber of the COVID-19 crisis’ economic consequences: perception of WSE investors," Oeconomia Copernicana, Institute of Economic Research, vol. 12(2), pages 335-374, June.
    18. Jelle R Dalenberg & Luca Nanetti & Remco J Renken & René A de Wijk & Gert J ter Horst, 2014. "Dealing with Consumer Differences in Liking during Repeated Exposure to Food; Typical Dynamics in Rating Behavior," PLOS ONE, Public Library of Science, vol. 9(3), pages 1-11, March.
    19. Carlos Fernández-Hernández & Carmelo J. León & Jorge E. Araña & Flora Díaz-Pére, 2016. "Market segmentation, activities and environmental behaviour in rural tourism," Tourism Economics, , vol. 22(5), pages 1033-1054, October.
    20. Haiyang Xia & Song Zha & Jijun Huang & Jibin Liu, 2020. "Radio environment map construction by adaptive ordinary Kriging algorithm based on affinity propagation clustering," International Journal of Distributed Sensor Networks, , vol. 16(5), pages 15501477209, May.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:abg:anprac:v:25:y:2021:i:1:1425. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Information Technology of ANPAD (email available below). General contact details of provider: http://anpad.org.br .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.