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The choice between two hypothesis tests

Author

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  • Ruist, Erik

    (Dept. of Economic Statistics, Stockholm School of Economics)

Abstract

Most standard hypothesis tests have high power only against a limited space of alternative hypotheses. With the advent of new tests for the same hypothesis, claimed to have higher power for some alternatives, but lower for other, the practitioner has to make a choice between alternative tests. This paper recommends the use of a pre-test to guide this choice, or the combined use of both tests.

Suggested Citation

  • Ruist, Erik, 2007. "The choice between two hypothesis tests," SSE/EFI Working Paper Series in Economics and Finance 667, Stockholm School of Economics.
    • Handle: RePEc:hhs:hastef:0667
    as

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    References listed on IDEAS

    as
    1. Peguin-Feissolle, A. & Terasvirta, T., 1999. "A General Framework for Testing the Granger Noncausality Hypothesis," G.R.E.Q.A.M. 99a42, Universite Aix-Marseille III.
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    More about this item

    Keywords

    sign test; t test; two-dimensional criterion;
    All these keywords.

    JEL classification:

    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General

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