Effects of outliers on regression model?


If outliers are present in our data, how does it affect our regression model?

Can someone please explain in the case of both linear and logistic regression model?



Outliers can have a dramatic impact on linear regression. It can change the model equation completely i.e. bad prediction or estimation. Look at the below scatter plot and linear equation with or without outlier.

Look at the both snapshots, equation parameters changing a lot.

For more detail on Outlier and ways to deal with it, you can read this article.