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# Assignment 03_EN Cluster Analysis T 03 MSc Business Administration Research Methods II Quantitative Research Methods Applied Data Analysis (with SPSS) Tasks Assignment 03: Cluster Analysis Prof. Dr....

Assignment 03_EN Cluster Analysis

T 03

Research Methods II
Quantitative Research Methods
Applied Data Analysis (with SPSS)
Prof. Dr. JÃ¼rg Schwarz Carlota de Miquel
Dr. Heidi Bruderer Enzler Viviane Pfluger
March 2018 XXXXXXXXXX

Task 01: Conducting a Cluster Analysis with SPSS____________________________ 1
Syntax ......................................................................................................................... XXXXXXXXXX1
Step 3: Determining the Number of Clusters ............................................................. XXXXXXXXXX3
Step 4: Display and Save Cluster Membership .......................................................... XXXXXXXXXX4
Step 5: Interpretation of Clusters ................................................................................ XXXXXXXXXX5
Conclusion .................................................................................................................. XXXXXXXXXX5
Task 02: Clustering Cities around the Globe _________________________________ 7
Divertimento ___________________________________________________________ 8
Appendix ______________________________________________________________ 9
Explanation of the Standardization of Variables in Cluster Analysis ......................... XXXXXXXXXX9
Cluster Analysis with Standardization in SPSS .......................................................... XXXXXXXXXX10
Assignment 03_EN_2018 Cluster Analysis, p. 1
Task 01: Conducting a Cluster Analysis with SPSS
Data set: Data_03a.sav

Create clusters for 15 EU countries based on energy consumption (energy) and the gross domestic
product (gdp).
Do the analysis twice, once using Between-Groups Linkage and once using Ward's method. Compare the
esults.

How many clusters are there? How would you interpret the content of the clusters?

Hints:
â€¢ Ca
y out a cluster analysis with standardization of the variables. An explanation on why and how to
do so can be found in the appendix to this assignment.
â€¢ A scatterplot is useful for interpreting the content when it shows the clusters in color.

Syntax
In this solution, the values are standardized by SPSS during the clustering process.

****** Method 1: Between-groups Linkage ******.

DATASET DECLARE D XXXXXXXXXX.
PROXIMITIES energy gdp
/MATRIX OUT(D XXXXXXXXXX)
/VIEW=CASE
/MEASURE=SEUCLID
/PRINT NONE
/ID=country
/STANDARDIZE=VARIABLE Z.
CLUSTER
/MATRIX IN(D XXXXXXXXXX)
/METHOD BAVERAGE
/ID=country
/PRINT SCHEDULE CLUSTER(2,5)
/PRINT DISTANCE
/PLOT DENDROGRAM VICICLE
/SAVE CLUSTER(2,5).
Dataset Close D XXXXXXXXXX.

* Scatter plot.
Assignment 03_EN_2018 Cluster Analysis, p. 2
GRAPH
/SCATTERPLOT(BIVAR)= energy WITH gdp BY CLU2_1 BY country (NAME)
/MISSING=LISTWISE.

* Mean values of cluster variables by cluster.
SORT CASES BY CLU2_1.
SPLIT FILE SEPARATE BY CLU2_1.
FREQUENCIES VARIABLES=energy gdp
/FORMAT=NOTABLE
/STATISTICS=MEAN
/ORDER=ANALYSIS.
SPLIT FILE OFF.

****** Method 2: Ward's Method ******.

DATASET DECLARE D XXXXXXXXXX.
PROXIMITIES energy gdp
/MATRIX OUT(D XXXXXXXXXX)
/VIEW=CASE
/MEASURE=SEUCLID
/PRINT NONE
/ID=country
/STANDARDIZE=VARIABLE Z.
CLUSTER
/MATRIX IN(D XXXXXXXXXX)
/METHOD WARD
/ID=country
/PRINT SCHEDULE CLUSTER(2,5)
/PRINT DISTANCE
/PLOT DENDROGRAM VICICLE
/SAVE CLUSTER(2,5).
Dataset Close D XXXXXXXXXX.

* Scatter plot.
GRAPH
/SCATTERPLOT(BIVAR)= energy WITH gdp BY CLU2_2 BY country (NAME)
/MISSING=LISTWISE.

* Mean values of cluster variables by cluster.
SORT CASES BY CLU2_2.
SPLIT FILE SEPARATE BY CLU2_2.
FREQUENCIES VARIABLES=energy gdp
/FORMAT=NOTABLE
/STATISTICS=MEAN
/ORDER=ANALYSIS.
SPLIT FILE OFF.

Assignment 03_EN_2018 Cluster Analysis, p. 3
Step 3: Determining the Number of Clusters
In both dendrograms below, the largest increase in heterogeneity is found when stepping from a two-
cluster to a one-cluster solution (red a
ows). This suggests a two-cluster solution.

Ward's Method

All countries are in one and the same cluster, except
for "L" (Luxembourg).

Ward's Method
The grouping is different. One difference is that "L"
is grouped with other cases in the second last step.

Assignment 03_EN_2018 Cluster Analysis, p. 4
Step 4: Display and Save Cluster Membership
As it was decided to opt for two clusters, only the column 2 Clusters is considered. The other solutions
(= the other columns) are i
elevant at this moment. (In case of between-groups linkage, it would also
have been possible to decide to look at the three-cluster solution â€“ column 3 Clusters â€“ instead.)

Ward's Method

The scatter plots illustrate that Luxembourg may be an outlier.
Assignment 03_EN_2018 Cluster Analysis, p. 5
Step 5: Interpretation of Clusters
Cluster 1 (14 countries):

Cluster 2 (Luxembourg):
Ward's Method
Cluster 1 (9 countries):

Cluster 2 (6 countries):

Luxembourg is in a separate cluster. Its GDP as
well as its energy consumption are higher than
in the other countries.
The question remains whether this solution is
useful. See overall comment at the end of this
Cluster 1: B, DK, D, FIN, F, L, NL, A, S
â†’ Northern Europe. A look at the mean
values reveals a higher GDP as well as a
higher energy consumption compared to
cluster 2.
Cluster 2: EL, UK, IRL, I, P, E
Answered Same Day Mar 16, 2020

## Solution

Viswanathan answered on Mar 19 2020
Solution
Cluster analysis was performed to determine the number of clusters formed in grouping the variables Wages index, Working hours per year, Household expenditures (USD, cost of living), Paid vacation days per year, Minutes of work necessary to buy a Big Mac, Minutes of work necessary to buy 1kg of
ead, Hours of work necessary to buy an iPhone 6 (16GB), and Inflation 2014. The analysis showed that the variables are grouped into three clusters with the classification of three groups is holding 56.7%, 6.7% and     33.3% of the data values respectively. The dendrogram is a...
SOLUTION.PDF