In this blog post, I explain why you need to use statistical hypothesis testing and help you navigate the essential terminology. Hypothesis testing is a crucial procedure to perform when you want to make inferences about a population using a random sample. These inferences include estimating population properties such as the mean, differences between means, proportions, and the relationships between variables.
This post provides an overview of statistical hypothesis testing. If you need to perform hypothesis tests, consider getting my book, Hypothesis Testing: An Intuitive Guide.
Why You Should Perform Statistical Hypothesis Testing
Hypothesis testing is a form of inferential statistics that allows us to draw conclusions about an entire population based on a representative sample. You gain tremendous benefits by working with a sample. In most cases, it is simply impossible to observe the entire population to understand its properties. The only alternative is to collect a random sample and then use statistics to analyze it.
While samples are much more practical and less expensive to work with, there are trade-offs. When you estimate the properties of a population from a sample, the sample statistics are unlikely to equal the actual population value exactly. For instance, your sample mean is unlikely to equal the population mean. The difference between the sample statistic and the population value is the sample error.
Differences that researchers observe in samples might be due to sampling error rather than representing a true effect at the population level. If sampling error causes the observed difference, the next time someone performs the same experiment the results might be different. Hypothesis testing incorporates estimates of the sampling error to help you make the correct decision. Learn more about Sampling Error.
For example, if you are studying the proportion of defects produced by two manufacturing methods, any difference you observe between the two sample proportions might be sample error rather than a true difference. If the difference does not exist at the population level, you won’t obtain the benefits that you expect based on the sample statistics. That can be a costly mistake!
Let’s cover some basic hypothesis testing terms that you need to know.
Background information: Difference between Descriptive and Inferential Statistics and Populations, Parameters, and Samples in Inferential Statistics
Hypothesis Testing
Hypothesis testing is a statistical analysis that uses sample data to assess two mutually exclusive theories about the properties of a population. Statisticians call these theories the null hypothesis and the alternative hypothesis. A hypothesis test assesses your sample statistic and factors in an estimate of the sample error to determine which hypothesis the data support.
When you can reject the null hypothesis, the results are statistically significant, and your data support the theory that an effect exists at the population level.
Effect
The effect is the difference between the population value and the null hypothesis value. The effect is also known as population effect or the difference. For example, the mean difference between the health outcome for a treatment group and a control group is the effect.
Typically, you do not know the size of the actual effect. However, you can use a hypothesis test to help you determine whether an effect exists and to estimate its size. Hypothesis tests convert your sample effect into a test statistic, which it evaluates for statistical significance. Learn more about Test Statistics.
An effect can be statistically significant, but that doesn’t necessarily indicate that it is important in a real-world, practical sense. For more information, read my post about Statistical vs. Practical Significance.
Null Hypothesis
The null hypothesis is one of two mutually exclusive theories about the properties of the population in hypothesis testing. Typically, the null hypothesis states that there is no effect (i.e., the effect size equals zero). The null is often signified by H0.
In all hypothesis testing, the researchers are testing an effect of some sort. The effect can be the effectiveness of a new vaccination, the durability of a new product, the proportion of defect in a manufacturing process, and so on. There is some benefit or difference that the researchers hope to identify.
However, it’s possible that there is no effect or no difference between the experimental groups. In statistics, we call this lack of an effect the null hypothesis. Therefore, if you can reject the null, you can favor the alternative hypothesis, which states that the effect exists (doesn’t equal zero) at the population level.
You can think of the null as the default theory that requires sufficiently strong evidence against in order to reject it.
For example, in a 2-sample t-test, the null often states that the difference between the two means equals zero.
When you can reject the null hypothesis, your results are statistically significant. Learn more about Statistical Significance: Definition & Meaning.
Related post: Understanding the Null Hypothesis in More Detail
Alternative Hypothesis
The alternative hypothesis is the other theory about the properties of the population in hypothesis testing. Typically, the alternative hypothesis states that a population parameter does not equal the null hypothesis value. In other words, there is a non-zero effect. If your sample contains sufficient evidence, you can reject the null and favor the alternative hypothesis. The alternative is often identified with H1 or HA.
For example, in a 2-sample t-test, the alternative often states that the difference between the two means does not equal zero.
You can specify either a one- or two-tailed alternative hypothesis:
If you perform a two-tailed hypothesis test, the alternative states that the population parameter does not equal the null value. For example, when the alternative hypothesis is HA: μ ≠ 0, the test can detect differences both greater than and less than the null value.
A one-tailed alternative has more power to detect an effect but it can test for a difference in only one direction. For example, HA: μ > 0 can only test for differences that are greater than zero.
Related posts: Understanding T-tests and One-Tailed and Two-Tailed Hypothesis Tests Explained
P-values
P-values are the probability that you would obtain the effect observed in your sample, or larger, if the null hypothesis is correct. In simpler terms, p-values tell you how strongly your sample data contradict the null. Lower p-values represent stronger evidence against the null. You use P-values in conjunction with the significance level to determine whether your data favor the null or alternative hypothesis.
Related post: Interpreting P-values Correctly
Significance Level (Alpha)
The significance level, also known as alpha or α, is an evidentiary standard that researchers set before the study. It specifies how strongly the sample evidence must contradict the null hypothesis before you can reject the null for the entire population. This standard is defined by the probability of rejecting a null hypothesis that is true. In other words, it is the probability that you say there is an effect when there is no effect. Lower significance levels indicate that you require stronger evidence before you will reject the null.
For instance, a significance level of 0.05 signifies a 5% risk of deciding that an effect exists when it does not exist.
Use p-values and significance levels together to help you determine which hypothesis the data support. If the p-value is less than your significance level, you can reject the null and conclude that the effect is statistically significant. In other words, the evidence in your sample is strong enough to be able to reject the null hypothesis at the population level.
Related posts: Graphical Approach to Significance Levels and P-values and Conceptual Approach to Understanding Significance Levels
Types of Errors in Hypothesis Testing
Statistical hypothesis tests are not 100% accurate because they use a random sample to draw conclusions about entire populations. There are two types of errors related to drawing an incorrect conclusion.
- False positives: You reject a null that is true. Statisticians call this a Type I error. The Type I error rate equals your significance level or alpha (α).
- False negatives: You fail to reject a null that is false. Statisticians call this a Type II error. Generally, you do not know the Type II error rate. However, it is a larger risk when you have a small sample size, noisy data, or a small effect size. The type II error rate is also known as beta (β).
Statistical power is the probability that a hypothesis test correctly infers that a sample effect exists in the population. In other words, the test correctly rejects a false null hypothesis. Consequently, power is inversely related to a Type II error. Power = 1 – β. Learn more about Power in Statistics.
Related posts: Types of Errors in Hypothesis Testing and Estimating a Good Sample Size for Your Study Using Power Analysis
Which Type of Hypothesis Test is Right for You?
There are many different types of procedures you can use. The correct choice depends on your research goals and the data you collect. Do you need to understand the mean or the differences between means? Or, perhaps you need to assess proportions. You can even use hypothesis testing to determine whether the relationships between variables are statistically significant.
To choose the proper statistical procedure, you’ll need to assess your study objectives and collect the correct type of data. This background research is necessary before you begin a study.
Related Post: Hypothesis Tests for Continuous, Binary, and Count Data
Statistical tests are crucial when you want to use sample data to make conclusions about a population because these tests account for sample error. Using significance levels and p-values to determine when to reject the null hypothesis improves the probability that you will draw the correct conclusion.
To see an alternative approach to these traditional hypothesis testing methods, learn about bootstrapping in statistics!
If you want to see examples of hypothesis testing in action, I recommend the following posts that I have written:
- How Effective Are Flu Shots? This example shows how you can use statistics to test proportions.
- Fatality Rates in Star Trek. This example shows how to use hypothesis testing with categorical data.
- Busting Myths About the Battle of the Sexes. A fun example based on a Mythbusters episode that assess continuous data using several different tests.
- Are Yawns Contagious? Another fun example inspired by a Mythbusters episode.
Hello professor Jim, how are you doing!
Pls. What are the properties of a population and their examples?
Thanks for your time and understanding.
Hi Aliyu,
Please read my post about Populations vs. Samples for more information and examples.
Also, please note there is a search bar in the upper-right margin of my website. Use that to search for topics.
Hello, I have a question as I read your post. You say in p-values section
“P-values are the probability that you would obtain the effect observed in your sample, or larger, if the null hypothesis is correct. In simpler terms, p-values tell you how strongly your sample data contradict the null. Lower p-values represent stronger evidence against the null.”
But according to your definition of effect, the null states that an effect does not exist, correct? So what I assume you want to say is that “P-values are the probability that you would obtain the effect observed in your sample, or larger, if the null hypothesis is **incorrect**.”
Hi Shrinivas,
The correct definition of p-value is that it is a probability that exists in the context of a true null hypothesis. So, the quotation is correct in stating “if the null hypothesis is correct.”
Essentially, the p-value tells you the likelihood of your observed results (or more extreme) if the null hypothesis is true. It gives you an idea of whether your results are surprising or unusual if there is no effect.
Hence, with sufficiently low p-values, you reject the null hypothesis because it’s telling you that your sample results were unlikely to have occurred if there was no effect in the population.
I hope that helps make it more clear. If not, let me know I’ll attempt to clarify!
Thanks a lot
Ny best regards
Hi Jim Can you tell me something about size effect?
Thanks
Hi Mayra,
Here’s a post that I’ve written about Effect Sizes that will hopefully tell you what you need to know. Please read that. Then, if you have any more specific questions about effect sizes, please post them there. Thanks!
Hi Jim, I have only read two pages so far but I am really amazed because in few paragraphs you made me clearly understand the concepts of months of courses I received in biostatistics! Thanks so much for this work you have done it helps a lot!
Hi Johan,
Thanks so much!
Can you help in the following question: Rocinante36 is priced at ₹7 lakh and has been designed to deliver a mileage of 22 km/litre and a top speed of 140 km/hr.
Formulate the null and alternative hypotheses for mileage and top speed to check whether the new models are performing as per the desired design specifications.
Hi Jim,
Its indeed great to read your work statistics.
I have a doubt regarding the one sample t-test. So as per your book on hypothesis testing with reference to page no 45, you have mentioned the difference between “the sample mean and the hypothesised mean is statistically significant”. So as per my understanding it should be quoted like “the difference between the population mean and the hypothesised mean is statistically significant”. The catch here is the hypothesised mean represents the sample mean.
Please help me understand this.
Regards
Rajat
Hi Rajat,
Thanks for buying my book. I’m so glad it’s been helpful!
The test is performed on the sample but the results apply to the population. Hence, if the difference between the sample mean (observed in your study) and the hypothesized mean is statistically significant, that suggests that population does not equal the hypothesized mean.
For one sample tests, the hypothesized mean is not the sample mean. It is a mean that you want to use for the test value. It usually represents a value that is important to your research. In other words, it’s a value that you pick for some theoretical/practical reasons. You pick it because you want to determine whether the population mean is different from that particular value.
I hope that helps!
Jim, you are such a magnificent statistician/economist/econometrician/data scientist etc whatever profession. Your work inspires and simplifies the lives of so many researchers around the world. I truly admire you and your work. I will buy a copy of each book you have on statistics or econometrics. Keep doing the good work. Remain ever blessed
Hi Renatus,
Thanks so much for you very kind comments. You made my day!! I’m so glad that my website has been helpful. And, thanks so much for supporting my books! 🙂
Hi Jim,
I hope you are aware of 2019 American Statistical Association’s official statement on Statistical Significance: https://www.tandfonline.com/doi/full/10.1080/00031305.2019.1583913
In case you do not bother reading the full article, may I quote you the core message here: “We conclude, based on our review of the articles in this special issue and the broader literature, that it is time to stop using the term “statistically significant” entirely. Nor should variants such as “significantly different,” “p < 0.05,” and “nonsignificant” survive, whether expressed in words, by asterisks in a table, or in some other way."
With best wishes,
John
Hi John,
I’m definitely aware of the debate surrounding how to use p-values most effectively. However, I need to correct you on one point. The link you provide is NOT a statement by the American Statistical Association. It is an editorial by several authors.
There is considerable debate over this issue. There are problems with p-values. However, as the authors state themselves, much of the problem is over people’s mindsets about how to use p-values and their incorrect interpretations about what statistical significance does and does not mean.
If you were to read my website more thoroughly, you’d be aware that I share many of their concerns and I address them in multiple posts. One of the authors’ key points is the need to be thoughtful and conduct thoughtful research and analysis. I emphasize this aspect in multiple posts on this topic. I’ll ask you to read the following three because they all address some of the authors’ concerns and suggestions. But you might run across others to read as well.
Five Tips for Using P-values to Avoid Being Misled
How to Interpret P-values Correctly
P-values and the Reproducibility of Experimental Results
HI Jim, i just want you to know that you made explanation for Statistics so simple! I should say lesser and fewer words that reduce the complexity. All the best! 🙂
Thanks, Rene! Your kind words mean a lot to me! I’m so glad it has been helpful!
Honestly, I never understood stats during my entire M.Ed course and was another nightmare for me. But how easily you have explained each concept, I have understood stats way beyond my imagination. Thank you so much for helping ignorant research scholars like us. Looking forward to get hardcopy of your book. Kindly tell is it available through flipkart?
Hi Varuna,
I’m so happy to hear that my website has been helpful!
I checked on flipkart and it appears like my books are not available there. I’m never exactly sure where they’re available due to the vagaries of different distribution channels. They are available on Amazon in India.
Introduction to Statistics: An Intuitive Guide (Amazon IN)
Hypothesis Testing: An Intuitive Guide (Amazon IN)
Dear Jim
I am a teacher from India . I don’t have any background in statistics, and still I should tell that in a single read I can follow your explanations . I take my entire biostatistics class for botany graduates with your explanations. Thanks a lot. May I know how I can avail your books in India
Hi Anila,
Right now my books are only available as ebooks from my website. However, soon I’ll have some exciting news about other ways to obtain it. Stay tuned! I’ll announce it on my email list. If you’re not already on it, you can sign up using the form that is in the right margin of my website.
Also can you please let me if this book covers topics like EDA and principal component analysis?
Hi Faraz,
This book doesn’t cover principal components analysis. Although, I wouldn’t really classify that as a hypothesis test. In the future, I might write a multivariate analysis book that would cover this and others. But, that’s well down the road.
My Introduction to Statistics covers EDA. That’s the largely graphical look at your data that you often do prior to hypothesis testing. The Introduction book perfectly leads right into the Hypothesis Testing book.
Hey Jim,
Thanks for the detailed explanation. It does clear my doubts.
I saw that your book related to hypothesis testing has the topics that I am studying currently. I am looking forward to purchasing it.
Regards,
Take Care
Hi Jim,
For this particular article I did not understand a couple of statements and it would great if you could help:
1)”If sample error causes the observed difference, the next time someone performs the same experiment the results might be different.”
2)”If the difference does not exist at the population level, you won’t obtain the benefits that you expect based on the sample statistics.”
I discovered your articles by chance and now I keep coming back to read & understand statistical concepts. These articles are very informative & easy to digest. Thanks for the simplifying things.
Regards,
Hi Faraz,
I’m so happy to hear that you’ve found my website to be helpful!
To answer your questions, keep in mind that a central tenant of inferential statistics is that the random sample that a study drew was only one of an infinite number of possible it could’ve drawn. Each random sample produces different results. Most results will cluster around the population value assuming they used good methodology. However, random sampling error always exists and makes it so that population estimates from a sample almost never exactly equal the correct population value.
So, imagine that we’re studying a medication and comparing the treatment and control groups. Suppose that the medicine is truly not effect and that the population difference between the treatment and control group is zero (i.e., no difference.) Despite the true difference being zero, most sample estimates will show some degree of either a positive or negative effect thanks to random sampling error. So, just because a study has an observed difference does not mean that a difference exists at the population level. So, on to your questions:
1. If the observed difference is just random error, then it makes sense that if you collected another random sample, the difference could change. It could change from negative to positive, positive to negative, more extreme, less extreme, etc. However, if the difference exists at the population level, most random samples drawn from the population will reflect that difference. If the medicine has an effect, most random samples will reflect that fact and not bounce around on both sides of zero as much.
2. This is closely related to the previous answer. If there is no difference at the population level, but say you approve the medicine because of the observed effects in a sample. Even though your random sample showed an effect (which was really random error), that effect doesn’t exist. So, when you start using it on a larger scale, people won’t benefit from the medicine. That’s why it’s important to separate out what is easily explained by random error versus what is not easily explained by it.
I think reading my post about how hypothesis tests work will help clarify this process. Also, in about 24 hours (as I write this), I’ll be releasing my new ebook about Hypothesis Testing!
Hi Jim, I really enjoy your blog. Can you please link me on your blog where you discuss about Subgroup analysis and how it is done? I need to use non parametric and parametric statistical methods for my work and also do subgroup analysis in order to identify potential groups of patients that may benefit more from using a treatment than other groups.
Hi, I don’t have a specific article about subgroup analysis. However, subgroup analysis is just the dividing up of a larger sample into subgroups and then analyzing those subgroups separately. You can use the various analyses I write about on the subgroups.
Alternatively, you can include the subgroups in regression analysis as an indicator variable and include that variable as a main effect and an interaction effect to see how the relationships vary by subgroup without needing to subdivide your data. I write about that approach in my article about comparing regression lines. This approach is my preferred approach when possible.
sir is confidence interval is a part of estimation?
Sir can u plz briefly explain alternatives of hypothesis testing? I m unable to find the answer
Hi Sana,
Assuming you want to draw conclusions about populations by using samples (i.e., inferential statistics), you can use confidence intervals and bootstrap methods as alternatives to the traditional hypothesis testing methods.
Hi JIm, could you please help with activities that can best teach concepts of hypothesis testing through simulation, Also, do you have any question set that would enhance students intuition why learning hypothesis testing as a topic in introductory statistics. Thanks.
Hi Jim, I’m studying multiple hypothesis testing & was wondering if you had any material that would be relevant. I’m more trying to understand how testing multiple samples simultaneously affects your results & more on the Bonferroni Correction
Hi Mia,
I write about multiple comparisons (aka post hoc tests) in the ANOVA context. I don’t talk about Bonferroni Corrections specifically but I cover related types of corrections. I’m not sure if that exactly addresses what you want to know but is probably the closest I have already written. I hope it helps!
Thank you! Have a great day/evening.
Any help would be greatly appreciated. What is the difference between The Hypothesis Test and The Statistical Test of Hypothesis?
Hi Derek,
They sound like the same thing to me. Unless this is specialized terminology for a particular field or the author was intending something specific, I’d guess they’re one and the same.
so these are the only two forms of Hypothesis used in statistical testing?
Are you referring to the null and alternative hypothesis? If so, yes, that’s those are the standard hypotheses in a statistical hypothesis test.
year very insightful post, thanks for the write up
hi there, am upcoming statistician, out of all blogs that i have read, i have found this one more useful as long as my problem is concerned. thanks so much
Hi Stano, you’re very welcome! Thanks for your kind words. They mean a lot! I’m happy to hear that my posts were able to help you. I’m sure you will be a fantastic statistician. Best of luck with your studies!
Dear Jim, thank you very much for your explanations! I have a question. Can I use t-test to compare two samples in case each of them have right bias?
Hi Tetyana,
You’re very welcome!
The term “right bias” is not a standard term. Do you by chance mean right skewed distributions? In other words, if you plot the distribution for each group on a histogram they have longer right tails? These are not the symmetrical bell-shape curves of the normal distribution.
If that’s the case, yes you can as long as you exceed a specific sample size within each group. I include a table that contains these sample size requirements in my post about nonparametric vs parametric analyses.
Bias in statistics refers to cases where an estimate of a value is systematically higher or lower than the true value. If this is the case, you might be able to use t-tests, but you’d need to be sure to understand the nature of the bias so you would understand what the results are really indicating.
I hope this helps!
Simple and upto the point 👍
Thank you so much.
Hi Kalpana, thanks! And I’m glad it was helpful!
Am I correct if I say:
Alpha – Probability of wrongly rejection of null hypothesis
P-value – Probability of wrongly acceptance of null hypothesis
Hi Farhan,
You’re correct about alpha. Alpha is the probability of rejecting the null hypothesis when the null is true.
Unfortunately, your definition of the p-value is a bit off. The p-value has a fairly convoluted definition. It is the probability of obtaining the effect observed in a sample, or more extreme, if the null hypothesis is true. The p-value does NOT indicate the probability that either the null or alternative is true or false. Although, those are very common misinterpretations. To learn more, read my post about how to interpret p-values correctly.
I hope this helps!
Hi Jim,
I recently started reading your blog and it is very helpful to understand each concept of statistical tests in easy way with some good examples.
Also, I recommend to other people go through all these blogs which you posted. Specially for those people who have not statistical background and they are facing to many problems while studying statistical analysis.
Thank you for your such good blogs.
Hi Amit, I’m so glad that my blog posts have been helpful for you! It means a lot to me that you took the time to write such a nice comment! Also, thanks for recommending by blog to others! I try really hard to write posts about statistics that are easy to understand.
Hi Jim,
I recently started reading your blog and I find it very interesting. I am learning statistics by my own, and I generally do many google search to understand the concepts. So this blog is quite helpful for me, as it have most of the content which I am looking for.
Thanks
Hi Shashank, thank you! And, I’m very glad to hear that my blog is helpful!
thank u very much sir.
You’re very welcome, Hiral!
Thank u so much sir….your posts always helps me to be a #statistician
Hi Sachin, you’re very welcome! I’m happy that you find my posts to be helpful!
great post as usual, but it would be nice to see an example.
Thank you! At the end of this post, I have links to four other posts that show examples of hypothesis tests in action. You’ll find what you’re looking for in those posts!