Does Proximity Really Matters? Unveiling the Role of Industrial Similarity with Ensemble Machine Learning

Does Proximity Really Matters? Unveiling the Role of Industrial Similarity with Ensemble Machine Learning

The authors investigate the role of industrial similarity and geographic proximity in predicting spending on veterinary care. Using machine learning, they find that industrial similarity plays a more substantial role than geographic proximity. Specifically, comparing feature importance reveals that industrial similarity is roughly five times as important as geographic proximity. Further, this study also investigates the importance of spender demographic information and resident demographic information in prediction performance. The result shows that spender demographic information is more important than resident demographic information in general. However, from a macro perspective, resident demographic information also holds importance.

The authors investigate the role of industrial similarity and geographic proximity in predicting spending on veterinary care. Using machine learning, they find that industrial similarity plays a more substantial role than geographic proximity. Specifically, comparing feature importance reveals that industrial similarity is roughly five times as important as geographic proximity. Further, this study also investigates the importance of spender demographic information and resident demographic information in prediction performance. The result shows that spender demographic information is more important than resident demographic information in general. However, from a macro perspective, resident demographic information also holds importance.