A Critique of One-Tailed Hypothesis Test Procedures in Business and Economics Statistics Textbooks

Abstract

The ability to conduct and correctly interpret the results of hypothesis tests is one of the most important skills that students can acquire in the introductory statistics course. Unfortunately, it is also one of the most difficult skills for them to learn.' Although this problem is widely recognized, textbook authors disagree about the best approach to use for conducting one-tailed hypothesis tests. In a recent survey of introductory business and economics statistics textbooks, we found that about half use the simple null hypothesis approach and about half use the composite null hypothesis approach for one-tailed hypothesis tests.2 Whereas both approaches are valid, the composite null hypothesis approach requires a more detailed statistical explanation than does the simple null hypothesis approach. Unfortunately, most textbooks that use the composite null hypothesis approach eschew the relevant explanation and use, instead, an explanation suitable only for the simple null hypothesis approach.