Executive Summary:
An extension of multiple correspondence analysis is proposed that takes into account cluster-level heterogeneity in respondents’ preferences/choices. The method involves combining multiple correspondence analysis and k-means in a unified framework. The former is used for uncovering a low-dimensional space of multivariate categorical variables while the latter is used for identifying relatively homogeneous clusters of respondents. The proposed method offers an integrated graphical display that provides information on cluster-based structures inherent in multivariate categorical data as well as the interdependencies among the data. An empirical application is presented which demonstrate the usefulness of the proposed method and how it compares to several extant approaches.
Keywords: Multiple correspondence analysis, k-means, cluster-level respondent heterogeneity, alternating least squares.
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