Using Partial Correlations to Unravel "Relationships"

A popular radio talk show host has just received the latest government study on public health care funding and has uncovered a startling fact: As health care funding increases, disease rates also increase! Cities that spend more actually seem to be worse off than cities that spend less.

Is health care funding bad for your health? The radio talk show host has the evidence that appears to prove that claim: The data in the government report yield a high, positive correlation between health care funding and disease rates -- which seems to indicate that people would be much healthier if the government simply stopped putting money into health care programs.

But is this really true? It certainly isn't likely that there's a causal relationship between health care funding and disease rates. Assuming the numbers are correct, are there other factors that might create the appearance of a relationship where none actually exists?

This example uses the data file health_funding.sav . See the topic Sample Files for more information.

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