The nugget effect refers to the phenomenon in spatial statistics where there is a discontinuity or a sudden change in the spatial autocorrelation of a variable at small distances. This effect indicates that there is a range of spatial variability that is not captured by traditional models, often attributed to measurement errors or unaccounted variability in the data. Recognizing this effect is crucial when utilizing spatial interpolation methods, as it influences how well predictions can be made based on sampled data points.
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