User:Smaines/random-vars-study

This page is about the statistical precision of estimates from sample surveys. For observational errors, see Observational error. For safety margins in engineering, see Factor of safety. For tolerance in engineering, see Tolerance (engineering). For the eponymous movie, see Margin for error (film).

Above, probability densities, of polls of different sizes, each color-coded to its 95% confidence interval (below), margin of error (left), and sample size (right). Each interval reflects the range within which one may have 95% confidence that the true percentage may be found, given a reported percentage of 50%. The margin of error is half the confidence interval (also, the radius of the interval). The larger the sample, the smaller the margin of error. Also, the further from 50% the reported percentage, the smaller the margin of error.

The margin of error is a statistic expressing the amount of random sampling error in the results of a survey. The larger the margin of error, the less confidence one should have that a poll result would reflect the result of a survey of the entire population. The margin of error will be positive whenever a population is incompletely sampled and the outcome measure has positive variance, which is to say, the measure varies.

The term margin of error is often used in non-survey contexts to indicate observational error in reporting measured quantities.

Concept

Consider a simple yes/no poll $P$ as a sample of $n$ respondents drawn from a population $N{\text{, }}(n<<N)$ reporting the percentage $p$ of yes responses. We would like to know how close $p$ is to the true result of a survey of the entire population $N$, without having to conduct one. If, hypothetically, we were to conduct poll $P$ over subsequent samples of $n$ respondents (newly drawn from $N$), we would expect those subsequent results $p_{1},p_{2},\ldots$ to be normally distributed about ${\overline {p}}$. The margin of error describes the distance within which a specified percentage of these results would vary from ${\overline {p}}$.

Standard deviation and standard error

According to the 68-95-98.5 rule, we would expect that 95% percent of the results $p_{1},p_{2},\ldots$ to fall within about two standard deviations ($\pm 2\sigma _{P}$) either side of the true mean ${\overline {p}}$. This interval is called the confidence interval, and the radius (half the interval) is called the margin of error.

We would expect the normally distributed values $p_{1},p_{2},\ldots$ to have a standard deviation which varies with $n$. This is called the standard error $\sigma _{\overline {p}}$.

For the single result from our survey, we assume that $p={\overline {p}}$, and that all subsequent results $p_{1},p_{2},\ldots$ together would have a variance $\sigma _{P}^{2}=P(1-P)$.

${\text{Standard error}}=\sigma _{\overline {p}}\approx {\sqrt {\frac {\sigma _{P}^{2}}{n}}}\approx {\sqrt {\frac {p(1-p)}{n}}}$

Note that $p(1-p)$ corresponds to the variance of a Bernoulli distribution.

Maximum margin of error at different confidence levels

Since $\max P(1-P)=0.25$ at $p=0.5$, we can arbitrarily set $p={\overline {p}}=0.5$, calculate $\sigma _{P}$ and $\sigma _{\overline {p}}$, and use multiples of $\sigma _{\overline {p}}$ to measure the maximum margin of error for $P$ at a given confidence interval and sample size even before having actual results. Precise multiples are given by the quantile function of the normal distribution (which the 68-95-99.7 rule approximates).

So, with $p=0.5,n=1013$

$maxMOE_{95}\approx 1.96\sigma _{\overline {p}}\approx 1.96{\sqrt {\frac {\sigma _{P}^{2}}{n}}}=1.96{\sqrt {\frac {.25}{n}}}=0.98/{\sqrt {n}}=\pm 3.1\%$

$maxMOE_{99}\approx 2.58\sigma _{\overline {p}}\approx 2.58{\sqrt {\frac {\sigma _{P}^{2}}{n}}}=2.58{\sqrt {\frac {.25}{n}}}=1.29/{\sqrt {n}}=\pm 4.1\%$

Also, usefully, for any reported $MOE_{95}$

$MOE_{99}={\frac {2.58\sigma _{\overline {p}}}{1.96\sigma _{\overline {p}}}}MOE_{95}\approx 1.3\times MOE_{95}$

Specific margins of error

If a poll has multiple percentage results (for example, a poll measuring a single multiple-choice preference), the result closest to 50% will have the highest margin of error. Typically, it is this number that is reported as the margin of error for the entire poll. Imagine poll $P$ reports $p_{a},p_{b},p_{c}$ as $71\%,27\%,2\%,n=1013$

$MOE_{95}(P_{a})\approx 1.96\sigma _{\overline {p_{a}}}\approx 1.96{\sqrt {\frac {p_{a}(1-p_{a})}{n}}}=0.89/{\sqrt {n}}=\pm 2.8\%$

$MOE_{95}(P_{b})\approx 1.96\sigma _{\overline {p_{b}}}\approx 1.96{\sqrt {\frac {p_{b}(1-p_{b})}{n}}}=0.87/{\sqrt {n}}=\pm 2.7\%$

$MOE_{95}(P_{c})\approx 1.96\sigma _{\overline {p_{c}}}\approx 1.96{\sqrt {\frac {p_{c}(1-p_{c})}{n}}}=0.27/{\sqrt {n}}=\pm 0.8\%$

As a given percentage approaches the extremes of 0% or 100%, its margin of error approaches ±0%.

Effect of finite population size

The formulae above for the margin of error assume that there is an infinitely large population and thus do not depend on the size of population $N$, but only on the sample size $n$. According to sampling theory, this assumption is reasonable when the sampling fraction is small. The margin of error for a particular sampling method is essentially the same regardless of whether the population of interest is the size of a school, city, state, or country, as long as the sampling fraction is small.

In cases where the sampling fraction is larger (in practice, greater that 5%), analysts might adjust the margin of error using a finite population correction to account for the added precision gained by sampling a much larger percentage of the population. FPC can be calculated using the formula

$\operatorname {FPC} ={\sqrt {\frac {N-n}{N-1}}}$

...and so if poll $P$ were conducted over 24% of, say, an electorate of 300,000 voters

$maxMOE_{95}\approx 1.96\sigma _{\overline {p}}={\frac {0.98}{\sqrt {72,000}}}=\pm \%0.4$

$maxMOE_{95_{FPC}}\approx 1.96\sigma _{\overline {p}}{\sqrt {\frac {N-n}{N-1}}}={\frac {0.98}{\sqrt {72,000}}}{\sqrt {\frac {300,000-72,000}{300,000-1}}}=\pm \%0.3$

Intuitively, for appropriately large $N$,

$\lim _{n\to 0}{\sqrt {\frac {N-n}{N-1}}}\approx 1$

$\lim _{n\to N}{\sqrt {\frac {N-n}{N-1}}}=0$

In the former case, $n$ is so small as to require no correction. In the latter case, the poll effectively becomes a census and sampling error becomes moot.

Comparing percentages

Imagine multiple-choice poll $P$ reports $p_{a},p_{b},p_{c}$ as $46\%,42\%,12\%,n=1013$. As described above, the margin of error reported for the poll would typically be $MOE_{95}(P_{a})$, as $p_{a}$is closest to 50%. The popular notion of statistical tie or statistical dead heat, however, concerns itself not with the accuracy of the individual results, but with that of the ranking of the results. Which is in first?

If, hypothetically, we were to conduct poll $P$ over subsequent samples of $n$ respondents (newly drawn from $N$), and report result $p_{w}=p_{a}-p_{b}$, we could use the standard error of difference to understand how $w_{1},w_{2},w_{3},\ldots$ is expected to fall about ${\overline {w}}$. For this, we need to apply the sum of variances to obtain a new variance, $\sigma _{P_{w}}^{2}$,

$\sigma _{P_{w}}^{2}=\sigma _{P_{a}-P_{b}}^{2}=\sigma _{P_{a}}^{2}+\sigma _{P_{b}}^{2}-2\sigma _{P_{a},P_{b}}=p_{a}(1-p_{a})+p_{b}(1-p_{b})+2p_{a}p_{b}$

where $\sigma _{P_{a},P_{b}}=-P_{a}P_{b}$ is the covariance of $P_{a}$and $P_{b}$.

Thus (after simplifying),

${\text{Standard error of difference}}=\sigma _{\overline {w}}\approx {\sqrt {\frac {\sigma _{P_{w}}^{2}}{n}}}={\sqrt {\frac {p_{a}+p_{b}-(p_{a}-p_{b})^{2}}{n}}}=0.02,P_{w}=P_{a}-P_{b}$

$MOE_{95}(P_{a})\approx 1.96\sigma _{\overline {p_{a}}}=\pm {3.1\%}$

$MOE_{95}(P_{w})\approx 1.96\sigma _{\overline {w}}=\pm {5.8\%}$

Note that this assumes that $P_{c}$ is close to constant, that is, respondents choosing either A or B would never chose C (making $P_{a}$and $P_{b}$ close to perfectly negatively correlated). With three or more choices in closer contention, choosing a correct formula for $\sigma _{P_{w}}^{2}$ becomes more complicated.

See also

• Engineering tolerance
• Key relevance
• Measurement uncertainty
• Observational error
• Random error

References

• Sudman, Seymour and Bradburn, Norman (1982). Asking Questions: A Practical Guide to Questionnaire Design. San Francisco: Jossey Bass. ISBN 0-87589-546-8
• Wonnacott, T.H. and R.J. Wonnacott (1990). Introductory Statistics (5th ed.). Wiley. ISBN 0-471-61518-8.

External links

• "Errors, theory of", Encyclopedia of Mathematics, EMS Press, 2001 [1994]
• Weisstein, Eric W. "Margin of Error". MathWorld.

Category:Statistical deviation and dispersion Category:Error Category:Measurement Category:Sampling (statistics)