Business Research Methods

Chapter 13. MEASUREMENT

AND SCALING CONCEPTS

Dr. Werner R. Murhadi

http://www.wernermurhadi.wordpress.com/

www.wernermurhadi.wordpress.com
 What Do I Measure?

 Measurement is the process of describing some property of a

phenomenon of interest, usually by assigning numbers in a reliable
and valid way.
 The numbers convey information about the property being measured.
 When numbers are used, the researcher must have a rule for
assigning a number to an observation in a way that provides an
accurate description.
 Concept
• A generalized idea about a class
of objects, attributes,
occurrences, or processes

Operational Definition
Specifies what the researcher
must do to measure the concept
under investigation
 scales
A device providing a range of values that correspond to different
values in a concept being measured.
 correspondence rules
Indicate the way that a certain value on a scale corresponds to
some true value of a concept.
 Hopefully, they do this in a truthful way.
 Here is an example of a correspondence rule: “Assign the numbers
1 through 7 according to how much trust that you have in your sales
representative. If the sales representative is perceived as
completely untrustworthy, assign the numeral 1, if the sales rep is
completely trustworthy, assign a 7.”
 Variables are things that we measure, control, or manipulate in
research.
 Before variables can be measured they must be defined. Types of
definitions:
 Theoretical: the words used in a theory; basically dictionary or
common use
 Operational: a definition that explains how the variable is to be
measured
 Operational definition: assigns a meaning to a concept or variable
by specifying the operations needed to measure it
 Sometimes, a single variable cannot capture a concept alone. Using
multiple variables to measure one concept can often provide a more
complete account of some concept than could any single variable.
 In social science, many concepts are measured with multiple
measurements.
 A construct is a term used for concepts that are measured with
multiple variables.
 For instance, when a business researcher wishes to measure the
customer orientation of a salesperson, several variables like these
may be used, each captured on a 1–5 scale:
1. I offer the product that is best suited to a customer’s problem.
2. A good employee has to have the customer’s best interests in mind.
3. I try to find out what kind of products will be most helpful to a customer.
Constructs can be very helpful in operationalizing a concept.
 Levels of Scale Measurement

The four levels or types of scale measurement are nominal, ordinal,

interval, and ratio level scales.

 Nominal variables allow for only qualitative classification.

 That is, they can be measured only in terms of whether the individual
items belong to some distinctively different categories, but we cannot
quantify or even rank order those categories.
 For example, all we can say is that two individuals are different in terms
of variable A (e.g., they are of different race), but we cannot say which
one "has more" of the quality represented by the variable.
 Typical examples of nominal variables are gender, race, color, city, etc.
 Ordinal variables allow us to rank order the items we measure in terms
of which has less and which has more of the quality represented by the
variable, but still they do not allow us to say "how much more."
 A typical example of an ordinal variable is the socioeconomic status of
families.
 For example, we know that upper-middle is higher than middle but we
cannot say that it is, for example, 18% higher.
 we can say that nominal measurement provides less information than
ordinal measurement, but we cannot say "how much less" or how this
difference compares to the difference between ordinal and interval scales.
 Interval variables allow us not only to rank order the items that are
measured, but also to quantify and compare the sizes of differences
between them.
 For example, temperature, as measured in degrees Fahrenheit or
Celsius, constitutes an interval scale. We can say that a temperature of
40 degrees is higher than a temperature of 30 degrees.
 Ratio variables are very similar to interval variables; in addition to all
the properties of interval variables, they feature an identifiable
absolute zero point, thus, they allow for statements such as x is two
times more than y.
 Typical examples of ratio scales are measures of time or space.
 For example, as the Kelvin temperature scale is a ratio scale, not only
can we say that a temperature of 200 degrees is higher than one of
100 degrees, we can correctly state that it is twice as high.
 Interval scales do not have the ratio property. Most statistical data
analysis procedures do not distinguish between the interval and
ratio properties of the measurement scales.
 Mathematical and Statistical Analysis of Scales

DISCRETE MEASURES
 Discrete measures are those that take on only one of a finite
number of values.
 A discrete scale is most often used to represent a classification
variable. Therefore, discrete scales do not represent intensity of
measures, only membership. Common discrete scales include any yes-
or-no response, matching, color choices, or practically any scale that
involves selecting from among a small number of categories. Thus,
when someone is asked to choose from the following responses
• Disagree
• Neutral
• Agree
 the result is a discrete value that can be coded 1, 2, or 3, respectively.
This is also an ordinal scale to the extent that it represents an ordered
arrangement of agreement.
 Nominal and ordinal scales are discrete measures.
CONTINUOUS MEASURES
 Continuous measures are those assigning values anywhere along some
scale range in a place that corresponds to the intensity of some concept.
 Ratio measures are continuous measures.
Strictly speaking, interval scales are not necessarily continuous.

This is a discrete scale because only the values 1, 2, 3, 4, or 5 can be

assigned. Furthermore, it is an ordinal scale because it only orders based on
agreement. We really have no way of knowing that the difference in
agreement of somebody marking a 5 instead of a 4 is the same as the
difference in agreement of somebody marking a 2 instead of a 1.
 The mean and standard deviation may be calculated from
continuous data.
 Using the actual quantities for arithmetic operations is permissible
with ratio scales.
 Thus, the ratios of scale values are meaningful. A ratio scale has all
the properties of nominal, ordinal, and interval scales.
 However, the same cannot be said in reverse.
 An interval scale, for example, has ordinal and nominal properties,
but it does not have ratio properties (see Exhibit 13.5).
 Three Criteria for Good Measurement

 The three major criteria for evaluating measurements are reliability,

validity, and sensitivity.
 Reliability is an indicator of a measure’s internal consistency.
 Validity is the accuracy of a measure or the extent to which a score
truthfully represents a concept. In other words, are we accurately
measuring what we think we are measuring?
 Sensitivity refers to an instrument’s ability to accurately measure
variability in a concept.
 RELIABILITY: INTERNAL CONSISTENCY

 Internal consistency is Represents a measure’s homogeneity or

the extent to which each indicator of a concept converges on some
common meaning.
 split-half method is A method for assessing internal consistency by
checking the results of one-half of a set of scaled items against the
results from the other half.
 coefficient alpha ( α ) is The most commonly appliedestimate of a
multiple-item scale’s reliability.
 It represents the average of all possible split-half reliabilities for a
construct.
 When the coefficient is below 0.6, the scale has poor reliability
 VALIDITY

 The four basic approaches to establishing validity are face validity,

content validity, criterion validity, and construct validity.
 Face validity is A scale’s content logically appears to reflect what was
 intended to be measured.
 content validity is The degree that a measure covers the breadth of the
domain of interest.
 criterion validity is The ability of a measure to correlate with other
standard measures of similar constructs or established criteria.
 construct validity is Exists when a measure reliably measures and
truthfully represents a unique concept; consists of several components
including face validity, content validty, criterion validity, convergent
validity, and discriminant validity.
 Construct validity

Construct validity consists of several components, including

• Face validity
• Content validity
• Criterion validity
• Convergent validity is Concepts that should be related to one
another are in fact related; highly reliable scales contain convergent
validity.
• Discriminant validity is Represents how unique or distinct is a
measure; a scale should not correlate too highly with a measure of a
different construct.
Validity & Reliability