Merits and demerits of neural networks

The neural network method for performing classification, prediction, and forecasting is still recognized as a black box methodology in different industries. People still provide more importance to logistic regression than neural network because of its complexity in explaining the relationship between the dependent and independent variable.

The limitations of the neural network model can be stated as follows:

  • In contrast to decision trees and rule extraction techniques, the knowledge (patterns) "discovered" by neural networks is not represented in a form understandable by humans.
  • Knowledge in a trained neural network (NN) is encoded in its connection weights; hence, NN cannot be used for descriptive data mining (exploration).
  • If NN are used for decision making, it is impossible to explain their decisions. Often other techniques have to be combined with NN for explanation.

Here are the merits of neural networks:

  • Though it is a bit complex to understand and interpret the results, still it is considered a powerful technique for classification and regression
  • It is considered a powerful machine learning technique for automatic predictive modeling
  • It captures complex relationships in datasets, which a traditional algorithm such as linear regression or logistic regression fails to understand and interpret
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