1. Data Analysis Module: Chi Square
R Programming
Data Analysis Module: Chi Square

2. Data Analysis Module
Basic Descriptive Statistics and Confidence Intervals
Basic Visualizations
Histograms
Pie Charts
Bar Charts
Scatterplots
Ttests/Bivariate testing
One Sample
Paired
Independent Two Sample
ANOVA
Chi Square and Odds
Regression Basics

3. Data Analysis Module: Chi Square
When presented with categorical data, one common method of analysis is the “Contingency Table” or “Cross Tab”. This is a great way to display frequencies -
For example, lets say that a firm has the following data:
120 male and 80 female employees
40 males and 10 females have been promoted

4. Data Analysis Module: Chi Square
Using this data, we could create the following 2x2 matrix:
Promoted
Not Promoted
Total
Male 40 80
120
Female 10 70 50
150
200

5. Data Analysis Module: Chi Square
Now, a few questions…
From the data, what is the probability of being promoted?
Given that you are MALE, what is the probability of being promoted?
Given that you are promoted, what is the probability that you are MALE?
Given that you are FEMALE, what is the probability of being promoted?
Given that you are promoted, what is the probability that you are female?

6. Data Analysis Module: Chi Square
The answers to these questions help us start to understand if promotion status and gender are related.
Specifically, we could test this relationship using a Chi-Square. This is the test used to determine if two variables are related.
The relevant hypothesis statements for a Chi-Square test are:
H0: Variable 1 and Variable 2 are NOT Related
Ha: Variable 1 and Variable 2 ARE Related
Develop the appropriate hypothesis statements and testing matrix for the gender/promotion data.

7. Data Analysis Module: Chi Square
The Chi-Square Test uses the Χ2 test statistic, which has a distribution that is skewed to the right (it approaches normality as the number of obs increases).
The observed counts are provided in the dataset.
The expected counts are the counts which would be expected if there was NO relationship between the two variables.

8. Data Analysis Module: Chi Square
Going back to our example, the data provided is “observed”:
Promoted
Not Promoted
Total
Male 40 80
120
Female 10 70 50
150
200
What would the matrix look like if there was no relationship between promotion status and gender? The resulting matrix would be “expected”…

9. Data Analysis Module: Chi Square
From the data, 25% of all employees were promoted. Therefore, if gender plays no role, then we should see 25% of the males promoted (75% not promoted) and 25% of the females promoted…
Promoted
Not Promoted
Total
Male
120*.25 = 30
120*.75 = 90
120
Female
80*.25 = 20
80*.75 = 60 80 50
150
200
Notice that the marginal values did not change…only the interior values changed.

10. Data Analysis Module: Chi Square
Now, calculate the X2 statistic using the observed and the expected matrices:
((40-30)2/30)+((80-90)2/90)+((10-20)2/20)+((70-60)2/60) =
= 11.11
This is conceptually equivalent to a t-statistic or a z-score.

11. Data Analysis Module: Chi Square
To determine if this is in the rejection region, we must determine the df.
Df = (r-1)*(c-1)…
In the current example, we have two rows and two columns. So the df = 1*1 = 1.
At alpha = .05 and 1df, the critical value is 3.84…our value of is clearly in the reject region…so what does this mean?

12. Data Analysis Module: Chi Square
#here, the code is pretty simple…first install the “prettyR” package. Then, you can run an xtab:
Xtab(var1~var2, data=data)
Then a Chi Squared test:
chisq.test(var1, var2, correct=FALSE)