Research Method
Quantitative Data Analysis
Topics
• Getting Data Ready
• Getting a Feel for the Data
• Hypotheses Testing
Getting the Data Ready for Analysis
• Data coding: assigning a number to the participants’ responses so they can be
entered into a database.
• Data Entry: after responses have been coded, they can be entered into a
database. Raw data can be entered through any software program (e.g., Stata,
Eviews, SPSS)
• Editing suspicious data:
• An illogical response or an outlier response. An outlier is an observation that
is substantially different from the other observations.
• Inconsistent responses are responses that are not in harmony with other
information.
• Illegal codes are values that are not specified in the coding instructions.
Getting a Feel for the Data
Economic Growth
Rapid expansion of service sector, while manufacturing sector lagging behind.
Innovation Capability in 1900 Explains Development Today
Faster Quality Growth is Riskier Quality Growth
Hypotheses Testing
• Null Hypothesis (denoted Ho):
the statement being tested in a test of hypothesis.
• Alternative Hypothesis (Ha):
what is believe to be true if the null hypothesis is false.
• Steps:
• Determine the null and alternative hypotheses.
• Specify the test statistic and its distribution if the null hypothesis is true.
• Select a and determine the rejection region.
• Calculate the sample value of the test statistic and, if desired, the p-value.
• State the conclusion.
Null Hypothesis
• We begin with the assumption that Ho is true and any difference
between the sample statistic and true population parameter is due to
chance and not a real (systematic) difference
• Similar to the notion of “innocent until proven guilty”
• That is, “innocence” is a null hypothesis
• Refers to the status quo
• Always contains “=” , “≤” or “≥” sign
• May or may not be rejected
Alternative Hypothesis
• Is the opposite of the null hypothesis
• Challenges the status quo
• Never contains the “=” , “≤” or “≥” sign
• May or may not be proven
• Is generally the hypothesis that the researcher is trying to prove.
Evidence is always examined with respect to Ha, never with respect
to Ho
• We never “accept” Ho, we either “reject” or “not reject” it
Rejection Region or Critical Value Approach
The given level of significance = α
Non-rejection region
H0: μ = 12 a /2 a /2
H1: μ ≠ 12 Represents
Two-tail test 12 critical value
H0: μ ≤ 12 H1: a Rejection
μ > 12 region is
Upper-tail test 12 shaded
H0: μ ≥ 12
a
H1: μ < 12
Lower-tail test 12
Type I and II Errors
• The size of α, the rejection region, affects the risk of making different
types of incorrect decisions.
• Type I Error (false-positive)
• Rejecting a true null hypothesis when it should NOT be rejected
• Considered a serious type of error
• The probability of Type I Error is α
• It is also called level of significance of the test
• Type II Error (false-negative)
• Fail to reject a false null hypothesis that should have been rejected
• The probability of Type II Error is β
Reference
• Sekaran, Bougie, 2016, Research Methods for Business, 7E.
• Cooper, Schindler, 2014, Business Research Methods, 12E.
• Saunders, Lewis, Thornhill, 2016, Research Methods for Business
Students, 7E
• Hamilton, 2013, Statistics with STATA ver 12
• Hill, Griffiths, Lim, 2011, Principles of Econometrics, 4E
• Huber, 2016, Introduction to Stata (ppt)
• https://www3.nd.edu/~rwilliam/stats/StataHighlights.html
• https://stats.idre.ucla.edu/stata/webbooks/reg/
