What is the difference between confounding and lurking variables?
this is an answer given by a Statistics teacher A lurking variable doesn’t just affect the apparent relationship between two variables. An interaction term might do that but wouldn’t be lurking. A lurking variable directly affects both X and Y and thereby makes it appear that X and Y are directly related to each other when, without the lurking variable, they would not be or would not be to that extent or in that direction. My favorite is the strong positive association between the number of firefighters at a fire and the amount of damage. Perhaps you shouldn’t call the fire department. The lurking variable is the size of the blaze, which “causes” both damage and fire fighters. It isn’t necessary for lurking variables to be unobserved. Often they are lying around in the open in the data or available in related data. It is their joint affect on two variables, creating the spurious appearance of a relationship that makes them “lurk”. The best lurking variable stories hint at spurious caus
