Statistics Dictionary
To see a definition, select a term from the dropdown text box below. The statistics
dictionary will display the definition, plus links to related web pages.
Select term:
Outlier
In
regression
analysis,
a data point that diverges greatly from the overall pattern of data
is called an outlier.
In more general usage,
an outlier is an extreme value that differs greatly from other values in
a set of values.
As a "rule of thumb",
an extreme value is considered to be an outlier if it is at least 1.5
interquartile ranges
below the first
quartile (Q1), or
at least 1.5 interquartile ranges above the third quartile (Q3).
To illustrate, consider the following example. Suppose we sample 10 households
and note the annual income of each household. Suppose we find that nine of the
households have incomes between $20,000 and $100,000; but the tenth
household has an annual income of $1,000,000,000. That tenth household is
an outlier.
The figure below shows a distribution with an outlier. Except for one lonely observation (the outlier on the extreme right), all of the other observations appear on the left side of the distribution.
