# Leverage Values

In regression,
leverage values refer to the diagonal elements of the hat matrix (X(X'X)-1X'). A given diagonal
element (h(ii)) represents the distance between X values
for the ith observation and the
means of all X
values. These values indicate whether X
values for a given observation are outlying. The diagonal element is referred
to as the leverage. A large leverage
value indicates that the ith
observation is distant from the center of the X
observations (Neter, et al, 1985).