Adjusting the Significance Level- A Guide to Changing Significance Levels in Stata

How to Change Significance Level in Stata

In statistical analysis, the significance level, often denoted as alpha (α), is a critical parameter that determines the threshold for rejecting the null hypothesis. By default, Stata uses a significance level of 0.05, which is a common choice in many fields. However, there may be situations where you need to change this level to suit your specific research needs. This article will guide you through the process of how to change the significance level in Stata.

Understanding the Significance Level

Before diving into the steps to change the significance level in Stata, it is essential to understand what the significance level represents. The significance level is the probability of rejecting the null hypothesis when it is true. In other words, it measures the likelihood of making a Type I error, which is the error of incorrectly rejecting a true null hypothesis.

Changing the Significance Level in Stata

To change the significance level in Stata, you can use the `set` command followed by the `significance` option. Here is an example of how to set the significance level to 0.01:

“`
. set significance 0.01
“`

This command will change the significance level to 0.01, which means that the probability of making a Type I error is now 1%.

Verifying the Significance Level

After setting the significance level, it is always a good practice to verify that the change has been applied correctly. You can do this by using the `get` command to display the current significance level:

“`
. get significance
“`

This command will output the current significance level, which should now be 0.01.

Using Different Significance Levels for Different Tests

It is important to note that changing the significance level affects all statistical tests performed in Stata. If you need to use different significance levels for different tests, you will have to change the level for each test individually. For example, if you want to use a significance level of 0.05 for a t-test and 0.01 for a chi-square test, you would set the levels accordingly:

“`
. set significance 0.05
. ttest variable1 variable2

. set significance 0.01
. chi2test variable1 variable2
“`

Conclusion

In summary, changing the significance level in Stata is a straightforward process that can be done using the `set` command. By understanding the implications of different significance levels and applying them appropriately, you can ensure that your statistical analyses are tailored to your specific research requirements.