How to Choose the Level of Significance: A Pedagogical Note

Jae Kim

MPRA Paper from University Library of Munich, Germany

Abstract: The level of significance should be chosen with careful consideration of the key factors such as the sample size, power of the test, and expected losses from Type I and II errors. While the conventional levels may still serve as practical benchmarks, they should not be adopted mindlessly and mechanically for every application.

Keywords: Expected Loss; Statistical Significance; Sample Size; Power of the test (search for similar items in EconPapers)
JEL-codes: A2 C12 (search for similar items in EconPapers)
Date: 2015-08-31
New Economics Papers: this item is included in nep-ecm
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Citations: View citations in EconPapers (5)

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https://mpra.ub.uni-muenchen.de/69990/1/MPRA_paper_66373.pdf revised version (application/pdf)
https://mpra.ub.uni-muenchen.de/69991/1/MPRA_paper_66373.pdf revised version (application/pdf)
https://mpra.ub.uni-muenchen.de/69992/10/MPRA_paper_69992.pdf revised version (application/pdf)

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