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Tests of Significance June 11, 2008 Ivan Katchanovski, Ph.D. POL 242Y-Y Tests of Statistical Significance • Tests of Statistical Significance: Formal and exact way to test hypotheses – Derived with help of advanced mathematics – Is a relationship between independent and dependent variables statistically significant? • Widely used in the social sciences – Often misused • Focus on application in research methods 2 Null Hypothesis Research Hypothesis (H1) Null Hypothesis (H0) • A statement about relationship between independent and dependent variables that we want to prove or disprove. • A statement of "no difference” between independent and dependent variables – Example: people with college education have higher incomes than people with high school education – Example: people with college education and people with high school education have the same incomes 3 Statistical Significance • The null hypothesis: Dependent and independent variables are statistically unrelated • If a relationship between an independent variable and a dependent variable is statistically nonsignificant – Null hypothesis is true – Research hypothesis is rejected • If a relationship between an independent variable and a dependent variable is statistically significant – Null hypothesis is false – Research hypothesis is supported 4 Criteria of Statistical Significance • Statistical significance: • SPSS p(obtained)<p.=.001, or p=.01, or p=.05 • Conventional levels of statistical significance: • Less than .001: Probability that a tested relationship occurred by chance is less than .001, or 1 in 1000, or .1% • Less than .01: Probability that a tested relationship occurred by chance is less than .01, or 1 in 100, or 1% • Less than .05: Probability that a tested relationship occurred by chance is less than .05, or 1 in 20, or 5% • Less than .10 (can be used if N is small) 5 Chi Square Test of Significance ( ) 2 • Can be used with variables at any level of measurement – Most appropriate for nominal and ordinal variables – Used in cross-tabulation analysis • Pearson’s Chi square distribution – – • Karl Pearson Eugenics Limitations – Problematic if expected frequencies in cells are small (5 or less) 6 Chi Square Distribution 7 Steps of Hypothesis Testing using Chi Square • Step 0. Research hypothesis – Example: political party support in the US differs by gender • Step 1. Assumptions: independent random sampling; variables are at nominal level of measurement • Step 2. Null Hypothesis: The dependent and the independent variables are not related – Example: political party support is not related to gender • Step 3. Selecting sampling distribution: SPSS does this automatically – Example: Chi-Square 8 Steps of Hypothesis Testing using Chi Square (Cont.) • Step 4. Computing the test statistic using Chi-square formulas or SPSS command (Crosstabs) • Step 5. Making a decision whether to reject or accept the null hypothesis. – If test statistic falls in the critical region: – SPSS p(obtained)<p=.05 • Reject the null hypothesis and accept research hypothesis – Statistically insignificant if test statistic (Chi-Square) does not fall in the critical region: – SPSS p(obtained)>p=.05 • Accept the null hypothesis and reject research hypothesis 9 Example: Political Party Support by Gender • Bivariate (two variables) table of frequency distribution • The dependent variable (political party support) is in rows • The independent variable (gender) is Political party in columns Male, % Female, % Republican 50 37 Democrat Total, % 50 100 63 100 N 503 551 Source: 1996 Lipset/Meltz Survey 10 Example: Chi Square Test • SPSS Chi square test: – Pearson Chi Square value= 16.219 – P = 0.000 • Pearson Chi Square value (16.219) falls in the critical region of Chi Square distribution (Determined manually) • SPSS automatic determination of statistical significance – SPSS p(obtained)=0.000<p=.05: Statistically significant – Select the lowest level of statistical significance • SPSS p(obtained)=0.000<p=.001 • Reject the null hypothesis • Accept the research hypothesis: – Political party support in the US differs by gender. – The difference is statistically significant at the .001 level 11 Limitations of Tests of Statistical Significance • Type I error (alpha) - rejecting a true null hypothesis • Type II (beta) - failing to reject a false null hypothesis • Equating statistical significance with real-life significance – Computers made statistical tests easy and fast – Almost any relationship can become statistically significant in surveys with very large number of respondents – Statistical significance does not always means real-life significance 12