IDEAS home Printed from https://ideas.repec.org/a/spr/cejnor/v26y2018i1d10.1007_s10100-017-0484-9.html
   My bibliography  Save this article

Time to dispense with the p-value in OR?

Author

Listed:
  • Marko Hofmann

    (Universität der Bundeswehr München)

  • Silja Meyer-Nieberg

    (Universität der Bundeswehr München)

Abstract

Null hypothesis significance testing is the standard procedure of statistical decision making, and p-values are the most widespread decision criteria of inferential statistics both in science, in general, and also in operations research, in particular. p-values are of paramount importance in the life and human sciences, and dominate statistical summaries in natural and technical sciences as well as in operations research, a domain in which the p-value seems to be a common denominator for decision making based on samples. Yet, the use of significance testing in the analysis of research data has been criticized from numerous statisticians—continuously for almost 100 years. This criticism has recently (March 7, 2016) been given an official status by a statement from the American Statistical Association on p-values. Is it time to dispense with the p-value in OR? The answer depends on many factors, including the research objective, the research domain, and, especially, the amount of information provided in addition to the p-value. Despite this dependence from context three conclusions can be made that should concern the operational analyst: First, p-values can perfectly cast doubt on a null hypothesis or its underlying assumptions, but they are only a first step of analysis, which, stand alone, lacks expressive power. Second, the statistical layman almost inescapably misinterprets the evidentiary value of p-values. Third and foremost, p-values are an inadequate choice for a succinct executive summary of statistical evidence for or against a research question. In statistical summaries confidence intervals of standardized effect sizes provide much more information than p-values without requiring much more space.

Suggested Citation

  • Marko Hofmann & Silja Meyer-Nieberg, 2018. "Time to dispense with the p-value in OR?," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 26(1), pages 193-214, March.
    • Handle: RePEc:spr:cejnor:v:26:y:2018:i:1:d:10.1007_s10100-017-0484-9
    DOI: 10.1007/s10100-017-0484-9
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10100-017-0484-9
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10100-017-0484-9?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Gigerenzer, Gerd, 2004. "Mindless statistics," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 33(5), pages 587-606, November.
    2. Coelho, V.N. & Grasas, A. & Ramalhinho, H. & Coelho, I.M. & Souza, M.J.F. & Cruz, R.C., 2016. "An ILS-based algorithm to solve a large-scale real heterogeneous fleet VRP with multi-trips and docking constraints," European Journal of Operational Research, Elsevier, vol. 250(2), pages 367-376.
    3. Kristof De Witte & Rui Marques, 2010. "Designing performance incentives, an international benchmark study in the water sector," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 18(2), pages 189-220, June.
    4. Armstrong, J. Scott, 2007. "Statistical significance tests are unnecessary even when properly done and properly interpreted: Reply to commentaries," International Journal of Forecasting, Elsevier, vol. 23(2), pages 335-336.
    5. Browne, Richard H., 2010. "The t-Test p Value and Its Relationship to the Effect Size and P(X>Y)," The American Statistician, American Statistical Association, vol. 64(1), pages 30-33.
    6. Leung, Stephen C.H. & Zhang, Zhenzhen & Zhang, Defu & Hua, Xian & Lim, Ming K., 2013. "A meta-heuristic algorithm for heterogeneous fleet vehicle routing problems with two-dimensional loading constraints," European Journal of Operational Research, Elsevier, vol. 225(2), pages 199-210.
    7. Gelman, Andrew & Stern, Hal, 2006. "The Difference Between," The American Statistician, American Statistical Association, vol. 60, pages 328-331, November.
    8. Vlado Kysucky & Lars Norden, 2016. "The Benefits of Relationship Lending in a Cross-Country Context: A Meta-Analysis," Management Science, INFORMS, vol. 62(1), pages 90-110, January.
    9. Kelley, Ken, 2007. "Confidence Intervals for Standardized Effect Sizes: Theory, Application, and Implementation," Journal of Statistical Software, Foundation for Open Access Statistics, vol. 20(i08).
    10. Larry V. Hedges, 1981. "Distribution Theory for Glass's Estimator of Effect size and Related Estimators," Journal of Educational and Behavioral Statistics, , vol. 6(2), pages 107-128, June.
    11. Jesper W. Schneider, 2015. "Null hypothesis significance tests. A mix-up of two different theories: the basis for widespread confusion and numerous misinterpretations," Scientometrics, Springer;Akadémiai Kiadó, vol. 102(1), pages 411-432, January.
    12. Daniele Fanelli, 2012. "Negative results are disappearing from most disciplines and countries," Scientometrics, Springer;Akadémiai Kiadó, vol. 90(3), pages 891-904, March.
    13. Jan M. Hoem, 2008. "The reporting of statistical significance in scientific journals," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 18(15), pages 437-442.
    14. Jérémie Gallien & Adam J. Mersereau & Andres Garro & Alberte Dapena Mora & Martín Nóvoa Vidal, 2015. "Initial Shipment Decisions for New Products at Zara," Operations Research, INFORMS, vol. 63(2), pages 269-286, April.
    15. Eugene Demidenko, 2016. "The p -Value You Can’t Buy," The American Statistician, Taylor & Francis Journals, vol. 70(1), pages 33-38, February.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Doll, Monika, 2017. "Relative efficiency of confidence interval methods around effect sizes," FAU Discussion Papers in Economics 22/2017, Friedrich-Alexander University Erlangen-Nuremberg, Institute for Economics.
    2. Jakub Bijak, 2019. "Editorial: P-values, theory, replicability, and rigour," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 41(32), pages 949-952.
    3. Ozgur Kabadurmus & Mehmet S. Erdogan, 2023. "A green vehicle routing problem with multi-depot, multi-tour, heterogeneous fleet and split deliveries: a mathematical model and heuristic approach," Journal of Combinatorial Optimization, Springer, vol. 45(3), pages 1-29, April.
    4. Shusen Qi & Steven Ongena & Hua Cheng, 2022. "Working with women, do men get all the credit?," Small Business Economics, Springer, vol. 59(4), pages 1427-1447, December.
    5. Jarko Fidrmuc & Philipp Schreiber & Martin Siddiqui, 2018. "Intangible Assets and the Determinants of a Single Bank Relation of German SMEs," European Journal of Business Science and Technology, Mendel University in Brno, Faculty of Business and Economics, vol. 4(1), pages 5-30.
    6. A. Guerrini & G. Romano & L. Carosi & F. Mancuso, 2017. "Cost Savings in Wastewater Treatment Processes: the Role of Environmental and Operational Drivers," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 31(8), pages 2465-2478, June.
    7. Hussain, Inayat & Durand, Robert B. & Harris, Mark N., 2021. "Relationship lending: A source of support or a means of exploitation?," Global Finance Journal, Elsevier, vol. 48(C).
    8. Litsiou, Konstantia & Polychronakis, Yiannis & Karami, Azhdar & Nikolopoulos, Konstantinos, 2022. "Relative performance of judgmental methods for forecasting the success of megaprojects," International Journal of Forecasting, Elsevier, vol. 38(3), pages 1185-1196.
    9. Julio Cabero-Almenara & Julio Barroso-Osuna & Carmen Llorente-Cejudo & María del Mar Fernández Martínez, 2019. "Educational Uses of Augmented Reality (AR): Experiences in Educational Science," Sustainability, MDPI, vol. 11(18), pages 1-18, September.
    10. Augusteijn, Hilde Elisabeth Maria & van Aert, Robbie Cornelis Maria & van Assen, Marcel A. L. M., 2021. "Posterior Probabilities of Effect Sizes and Heterogeneity in Meta-Analysis: An Intuitive Approach of Dealing with Publication Bias," OSF Preprints avkgj, Center for Open Science.
    11. Thomas Mayer, 2012. "Ziliak and McCloskey's Criticisms of Significance Tests: An Assessment," Econ Journal Watch, Econ Journal Watch, vol. 9(3), pages 256-297, September.
    12. Martin Brown & Matthias Hoffmann, 2016. "Relationship Banking in the Residential Mortgage Market? Evidence from Switzerland," Swiss Journal of Economics and Statistics, Springer;Swiss Society of Economics and Statistics, vol. 152(1), pages 23-48, January.
    13. Ornelas, José Renato Haas & da Silva, Marcos Soares & Van Doornik, Bernardus Ferdinandus Nazar, 2022. "Informational switching costs, bank competition, and the cost of finance," Journal of Banking & Finance, Elsevier, vol. 138(C).
    14. Michael Zschille, 2012. "Consolidating the Water Industry: An Analysis of the Potential Gains from Horizontal Integration in a Conditional Efficiency Framework," Discussion Papers of DIW Berlin 1187, DIW Berlin, German Institute for Economic Research.
    15. Colin F. Camerer & Anna Dreber & Felix Holzmeister & Teck-Hua Ho & Jürgen Huber & Magnus Johannesson & Michael Kirchler & Gideon Nave & Brian A. Nosek & Thomas Pfeiffer & Adam Altmejd & Nick Buttrick , 2018. "Evaluating the replicability of social science experiments in Nature and Science between 2010 and 2015," Nature Human Behaviour, Nature, vol. 2(9), pages 637-644, September.
    16. Nakashima, Kiyotaka & Takahashi, Koji, 2020. "The time has come for banks to say goodbye: New evidence on bank roles and duration effects in relationship terminations," Journal of Banking & Finance, Elsevier, vol. 115(C).
    17. Leonardo Gambacorta & Alessio Reghezza & Martina Spaggiari & Livia Pancotto, 2022. "Gender diversity in bank boardrooms and green lending: evidence from euro area credit register data," BIS Working Papers 1044, Bank for International Settlements.
    18. Lukas Haffert, 2019. "War mobilization or war destruction? The unequal rise of progressive taxation revisited," The Review of International Organizations, Springer, vol. 14(1), pages 59-82, March.
    19. Goedde-Menke, Michael & Ingermann, Peter-Hendrik, 2024. "Loan officer specialization and credit defaults," Journal of Banking & Finance, Elsevier, vol. 161(C).
    20. Hibbeln, Martin & Norden, Lars & Usselmann, Piet & Gürtler, Marc, 2020. "Informational synergies in consumer credit," Journal of Financial Intermediation, Elsevier, vol. 44(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:cejnor:v:26:y:2018:i:1:d:10.1007_s10100-017-0484-9. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.