1. Discriminant Analysis • Introduction • Types of DA • Assumptions • Model representation, data type/sample size • Measurements • Steps to solve DA problems • An numerical example • SPSS commands

2. Discriminant Analysis • is a powerful statistical tool used to study the differences between groups of objects • Here, objects could be • an individual person or firms, and • classifying them can be based on prior or posterior factors or characteristics

3. Two groups refer to as two-group discriminant analysis Its dependent variable is termed as dichotomous Three or more group Refer to as multiple discriminant analysis (MDA) Its corresponding dependent variables are termed as multichotomous Types of DA

4. 1) multivariate normality, uses the normal probability plot approach uses the most common statistical tests are the calculation of skewness value 2) equal covariance matrices Use covariance to check their corelations 3) multicollinearity, among independent variables That is to check independent variables are not correlated to each other 4) Outliers "the observations with a unique combination of characteristics identifiable as distinctly different from the other observations". Assumptions

5. Model representation Data type: Dependent variables = non-metric format Indep variables = metric format Sample size : between 5-20 obs for each independent variables

6. Measurements • Group categorizations • Hit ratio • Discriminating power

7. Steps to solve DA problems • Step 1: Assess the assumptions • Step 2: Estimate the discriminant function(s) and its (their) significance • Step 3: Assess the overall fit

8. Example You can obtain this paper by clicking Discriminant paper from my web site

9. Objective: • To discriminate the difference practices between the high and low performance of firms practicing TQM is ISF • Use score of overall satisfaction as a mean for discriminating factor • Steps: • Step 1, refer to p 762 • Step 2, refer to p763 • Step 3, refer to p763 • Discussion, you can refer to the “discussion” section

10. SPSS commands

11. Step 3, refer to p763

12. Step 2, refer to p763

13. Step 1, refer to p 762

14. Discriminating power References: refer to “hit ratio” for details

15. Hit ratio • Used to measure the model fitness • Is a maximum chance criteria Note: We need to compute this value for our original sample size and then compare to the value that produced by the SPSS; and computer value should not be less than the formal value in order to claim the significant of fitness of model

16. Group categorizations