What is quantitative analysis (Quantitative Analysis)
Quantitative analysis studies and predicts market behavior (including prices) using mathematical, statistical and econometric tools. Particularly characteristic of quantitative methods is the description of economic (but also chemical, physical and other) states by measurable indicators. The result of quantitative analysis carried out with the help of appropriate tools is the value of a specific parameter defined by a number.
Advantages of quantitative methods
The following advantages arise from the fact that the results of quantitative methods are expressed in terms of specific numerical values assigned to specific parameters:
- ease of comparing results between study groups
- ease of comparing results over time
- study of the influence of individual factors on a given phenomenon
- objectivity of the study
What does quantitative analysis do?
Quantitative analysis has found particular application in the field of economics. Micro and macroeconomic indicators, developed over decades, allow a detailed description of the economic situation with the help of quantitative analysis indicators.
What are the methods of quantitative analysis?
Among the quantitative methods we find such as research esperiments, surveys or observations. At the same time, indicators of quantitative methods are also calculated in enterprises or the economy on the basis of collected financial or sales data.
Quantitative and qualitative analysis – the differences
Qualitative analysis, as opposed to quantitative analysis, answers the questions how? why? in what way? – while it does not answer the question how much? An example of a survey question for qualitative analysis would be “Is product A better than product B?” An attempt to translate this into quantitative methods, on the other hand, would be to rate both products on a scale of 1 to 10 – allowing for a more concrete comparison of the products (even if in this case it will not be fully objective).
What indicators are present in quantitative analysis?
An indicator in quantitative analysis can be any parameter that is commonly understood or is clarified for the purposes of a particular study. The value of the parameter should be specified numerically. Indicator analysis also deals with the precise study and description of indicators.
Quantitative analysis – examples
Examples of quantitative analysis include the most popular macroeconomic indicators like the value of Gross Domestic Product, GDP per capita, CPI (commodity price index).
