# Principal Components and Factor Analysis Introductory Overview - General Purpose

Principal Components and Factor Analysis

The main applications of factor analytic techniques are 1) to reduce the number of variables and 2) to detect structure in the relationships between variables, that is to classify variables. Therefore, factor analysis is applied as a data reduction or structure detection method (the term factor analysis was first introduced by Thurstone, 1931, although similar techniques were used by Spearman as early as 1904 in his classic research on the nature of intelligence). The topics listed below will describe the principles of factor analysis, and how it can be applied towards these two purposes. We will assume that you are familiar with the basic logic of statistical reasoning as described in Elementary Concepts. Moreover, we will also assume that you are familiar with the concepts of variance and correlation; if not, we advise that you read the Basic Statistics introductory overviews at this point.

There are many excellent books on factor analysis. For example, a hands-on how-to approach can be found in Stevens (1986); more detailed technical descriptions are provided in Cooley and Lohnes (1971); Harman (1976); Kim and Mueller, (1978a, 1978b); Lawley and Maxwell (1971); Lindeman, Merenda, and Gold (1980); Morrison (1967); or Mulaik (1972). The interpretation of secondary factors in hierarchical factor analysis, as an alternative to traditional oblique rotational strategies, is explained in detail by Wherry (1984).

Confirmatory factor analysis. STATISTICA also includes the general Structural Equation Modeling (SEPATH) module. The procedures available in that module allow you to test specific hypotheses about the factor structure for a set of variables, in one or several samples (e.g., you can compare factor structures across samples). The Examples section of SEPATH discusses several examples of such analyses.

Correspondence analysis. Correspondence analysis is a descriptive/exploratory technique designed to analyze two-way and multi-way tables containing some measure of correspondence between the rows and columns. The results provide information which is similar in nature to those produced by factor analysis techniques, and they allow one to explore the structure of categorical variables included in the table. For more information regarding these methods, refer to the description of the Correspondence Analysis module.

See also the Factor Analysis Overviews Index for links to more detailed overviews and Exploratory Data Analysis and Data Mining Techniques.