Abstract
The discussion on the use and misuse of p-values in 2016 by the American Statistician Association was a timely assertion that statistical concept should be properly used in science. Some researchers, especially the economists, who adopt significance testing and p-values to report their results, may felt confused by the statement, leading to misinterpretations of the statement. In this study, we aim to re-examine the accuracy of the p-value and introduce an alternative way for testing the hypothesis. We conduct a simulation study to investigate the reliability of the p-value. Apart from investigating the performance of p-value, we also introduce some existing approaches, Minimum Bayes Factors and Belief functions, for replacing p-value. Results from the simulation study confirm unreliable p-value in some cases and that our proposed approaches seem to be useful as the substituted tool in the statistical inference. Moreover, our results show that the plausibility approach is more accurate for making decisions about the null hypothesis than the traditionally used p-values when the null hypothesis is true. However, the MBFs of Edwards et al. [Bayesian statistical inference for psychological research. Psychol. Rev. 70(3) (1963), pp. 193–242]; Vovk [A logic of probability, with application to the foundations of statistics. J. Royal Statistical Soc. Series B (Methodological) 55 (1993), pp. 317–351] and Sellke et al. [Calibration of p values for testing precise null hypotheses. Am. Stat. 55(1) (2001), pp. 62–71] provide more reliable results compared to all other methods when the null hypothesis is false.
Acknowledgments
The authors would like to thank the four anonymous reviewers, the editor, and Prof. Hung T. Nguyen for his helpful comments and suggestions. The financial support of this work is provided by Center of Excellence in Econometrics, Chiang Mai University.
Disclosure statement
No potential conflict of interest was reported by the author(s).