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Parametric statistics are the most common type of inferential statistics. Inferential statistics are calculated with the purpose of generalizing the findings of a sample to the population it represents, and they can be classified as either parametric or non-parametric. Parametric tests make assumptions about the parameters of a population, whereas nonparametric tests do not include such assumptions or include fewer. For instance, parametric tests assume that the sample has been randomly selected from the population it represents and that the distribution of data in the population has a known underlying distribution. The most common distribution assumption is that the distribution is normal. Other distributions include the binomial distribution (logistic regression) and the Poisson distribution (Poisson regression). Additionally, parametric statistics require that the data are measured using an interval or ratio scale, whereas nonparametric statistics use data that are measured with a nominal or ordinal scale. Some frequently used parametric tests that include the assumption of a normal distribution include the following: Student's t test, analysis of variance, Pearson's r correlation, and linear regression. Selection of the correct statistical test is important because if the wrong test is selected, the researcher increases the chances of coming to the wrong conclusion.

This entry first reviews inferential statistics methodologies. Next, it discusses the underlying assumptions for parametric statistics and parametric methods, and corrections for assumption violations. Finally, this entry discusses the advantages of parametric statistics.

Inferential Statistics

There are two types of methodologies used in inferential statistics: hypothesis testing and estimation of population parameters. Each of these methodologies includes parametric and nonparametric tests.

Hypothesis testing uses sample data to test a prediction about a population or the relationship between two or more populations. The predictions are stated as two statistical hypotheses. The null hypothesis, H0, states that there is no effect or no difference. The alternative hypothesis, Ha, indicates the presence of an effect or difference. This is usually the hypothesis that the researcher expects to be supported. Within hypothesis testing, it is possible for a researcher to commit two types of errors, Type I and Type II. A Type I error occurs when a true null hypothesis is rejected; that is, the conclusion is made that the alternative hypothesis is true when it is not. The likelihood of committing such an error is specified by the alpha level. For example, the likelihood of committing a Type I error if α = .05 is 5%. A Type II error occurs when a false null hypothesis is not rejected; that is, the conclusion is made that an alternative hypothesis is not true when it is. The likelihood of committing such an error is specified by beta, β. This is related to the power of a statistical test. Power refers to the probability that a null hypothesis will be rejected when it is false—in other words, the probability of finding a statistically significant result. Power depends on the significance level (α), the sample size, and the population effect size.

Estimation of population parameters includes point estimation and interval estimation. Point estimation involves estimating the parameter value from the computed sample statistics. It is the “best guess” for an unknown population parameter. Statistics refer to characteristics of an observed sample and are measured using measures of central tendency (i.e., mean, median, mode) and measures of variability (i.e., variance and standard deviation). Parameters refer to characteristics of a population. Interval estimation, the more commonly used, involves using sample data to compute a range of values that includes the unknown population parameter. The confidence interval is the most common form of interval estimation.

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