The world is constantly curious about the Chi-Square test's application in machine learning and how it makes a difference. Feature selection is a critical topic in machine learning, as you will have multiple features in line and must choose the best ones to build the model. By examining the relationship between the elements, the chi-square test aids in the solution of feature selection problems. In this tutorial, you will learn about the chi-square test and its application.

## What Is a Chi-Square Test?

The Chi-Square test is a statistical procedure for determining the difference between observed and expected data. This test can also be used to determine whether it correlates to the categorical variables in our data. It helps to find out whether a difference between two categorical variables is due to chance or a relationship between them.

## Chi-Square Test Definition

A chi-square test is a statistical test that is used to compare observed and expected results. The goal of this test is to identify whether a disparity between actual and predicted data is due to chance or to a link between the variables under consideration. As a result, the chi-square test is an ideal choice for aiding in our understanding and interpretation of the connection between our two categorical variables.

A chi-square test or comparable nonparametric test is required to test a hypothesis regarding the distribution of a categorical variable. Categorical variables, which indicate categories such as animals or countries, can be nominal or ordinal. They cannot have a normal distribution since they can only have a few particular values.

For example, a meal delivery firm in India wants to investigate the link between gender, geography, and people's food preferences.

It is used to calculate the difference between two categorical variables, which are:

- As a result of chance or
- Because of the relationship

## Formula For Chi-Square Test

Where

c = Degrees of freedom

O = Observed Value

E = Expected Value

The degrees of freedom in a statistical calculation represent the number of variables that can vary in a calculation. The degrees of freedom can be calculated to ensure that chi-square tests are statistically valid. These tests are frequently used to compare observed data with data that would be expected to be obtained if a particular hypothesis were true.

The Observed values are those you gather yourselves.

The expected values are the frequencies expected, based on the null hypothesis.

## Fundamentals of Hypothesis Testing

Hypothesis testing is a technique for interpreting and drawing inferences about a population based on sample data. It aids in determining which sample data best support mutually exclusive population claims.

Null Hypothesis (H0) - The Null Hypothesis is the assumption that the event will not occur. A null hypothesis has no bearing on the study's outcome unless it is rejected.

H0 is the symbol for it, and it is pronounced H-naught.

Alternate Hypothesis(H1 or Ha) - The Alternate Hypothesis is the logical opposite of the null hypothesis. The acceptance of the alternative hypothesis follows the rejection of the null hypothesis. H1 is the symbol for it.

## What Are Categorical Variables?

Categorical variables belong to a subset of variables that can be divided into discrete categories. Names or labels are the most common categories. These variables are also known as qualitative variables because they depict the variable's quality or characteristics.

Categorical variables can be divided into two categories:

- Nominal Variable: A nominal variable's categories have no natural ordering. Example: Gender, Blood groups
- Ordinal Variable: A variable that allows the categories to be sorted is ordinal variables. Customer satisfaction (Excellent, Very Good, Good, Average, Bad, and so on) is an example.

## Why Do You Use the Chi-Square Test?

Chi-square is a statistical test that examines the differences between categorical variables from a random sample in order to determine whether the expected and observed results are well-fitting.

Here are some of the uses of the Chi-Squared test:

- The Chi-squared test can be used to see if your data follows a well-known theoretical probability distribution like the Normal or Poisson distribution.
- The Chi-squared test allows you to assess your trained regression model's goodness of fit on the training, validation, and test data sets.

## What Does A Chi-Square Statistic Test Tell You?

A Chi-Square test ( symbolically represented as 2 ) is fundamentally a data analysis based on the observations of a random set of variables. It computes how a model equates to actual observed data. A Chi-Square statistic test is calculated based on the data, which must be raw, random, drawn from independent variables, drawn from a wide-ranging sample and mutually exclusive. In simple terms, two sets of statistical data are compared -for instance, the results of tossing a fair coin. Karl Pearson introduced this test in 1900 for categorical data analysis and distribution. This test is also known as ‘Pearson’s Chi-Squared Test’.

Chi-Squared Tests are most commonly used in hypothesis testing. A hypothesis is an assumption that any given condition might be true, which can be tested afterwards. The Chi-Square test estimates the size of inconsistency between the expected results and the actual results when the size of the sample and the number of variables in the relationship is mentioned.

These tests use degrees of freedom to determine if a particular null hypothesis can be rejected based on the total number of observations made in the experiments. Larger the sample size, more reliable is the result.

There are two main types of Chi-Square tests namely -

- Independence
- Goodness-of-Fit

### Independence

The Chi-Square Test of Independence is a derivable ( also known as inferential ) statistical test which examines whether the two sets of variables are likely to be related with each other or not. This test is used when we have counts of values for two nominal or categorical variables and is considered as non-parametric test. A relatively large sample size and independence of obseravations are the required criteria for conducting this test.

For Example-

In a movie theatre, suppose we made a list of movie genres. Let us consider this as the first variable. The second variable is whether or not the people who came to watch those genres of movies have bought snacks at the theatre. Here the null hypothesis is that th genre of the film and whether people bought snacks or not are unrelatable. If this is true, the movie genres don’t impact snack sales.

### Goodness-Of-Fit

In statistical hypothesis testing, the Chi-Square Goodness-of-Fit test determines whether a variable is likely to come from a given distribution or not. We must have a set of data values and the idea of the distribution of this data. We can use this test when we have value counts for categorical variables. This test demonstrates a way of deciding if the data values have a “ good enough” fit for our idea or if it is a representative sample data of the entire population.

For Example-

Suppose we have bags of balls with five different colours in each bag. The given condition is that the bag should contain an equal number of balls of each colour. The idea we would like to test here is that the proportions of the five colours of balls in each bag must be exact.

## Who Uses Chi-Square Analysis?

Chi-square is most commonly used by researchers who are studying survey response data because it applies to categorical variables. Demography, consumer and marketing research, political science, and economics are all examples of this type of research.

## Example

Let's say you want to know if gender has anything to do with political party preference. You poll 440 voters in a simple random sample to find out which political party they prefer. The results of the survey are shown in the table below:

To see if gender is linked to political party preference, perform a Chi-Square test of independence using the steps below.

### Step 1: Define the Hypothesis

H0: There is no link between gender and political party preference.

H1: There is a link between gender and political party preference.

### Step 2: Calculate the Expected Values

Now you will calculate the expected frequency.

For example, the expected value for Male Republicans is:

Similarly, you can calculate the expected value for each of the cells.

### Step 3: Calculate (O-E)2 / E for Each Cell in the Table

Now you will calculate the (O - E)2 / E for each cell in the table.

Where

O = Observed Value

E = Expected Value

### Step 4: Calculate the Test Statistic X2

X2 is the sum of all the values in the last table

= 0.743 + 2.05 + 2.33 + 3.33 + 0.384 + 1

= 9.837

Before you can conclude, you must first determine the critical statistic, which requires determining our degrees of freedom. The degrees of freedom in this case are equal to the table's number of columns minus one multiplied by the table's number of rows minus one, or (r-1) (c-1). We have (3-1)(2-1) = 2.

Finally, you compare our obtained statistic to the critical statistic found in the chi-square table. As you can see, for an alpha level of 0.05 and two degrees of freedom, the critical statistic is 5.991, which is less than our obtained statistic of 9.83. You can reject our null hypothesis because the critical statistic is higher than your obtained statistic.

This means you have sufficient evidence to say that there is an association between gender and political party preference.

## When to Use a Chi-Square Test?

A Chi-Square Test is used to examine whether the observed results are in order with the expected values. When the data to be analysed is from a random sample, and when the variable is the question is a categorical variable, then Chi-Square proves the most appropriate test for the same. A categorical variable consists of selections such as breeds of dogs, types of cars, genres of movies, educational attainment, male v/s female etc. Survey responses and questionnaires are the primary sources of these types of data. The Chi-square test is most commonly used for analysing this kind of data. This type of analysis is helpful for researchers who are studying survey response data. The research can range from customer and marketing research to political sciences and economics.

## Chi-Square Distribution

Chi-square distributions (X2) are a type of continuous probability distribution. They're commonly utilized in hypothesis testing, such as the chi-square goodness of fit and independence tests. The parameter k, which represents the degrees of freedom, determines the shape of a chi-square distribution.

A chi-square distribution is followed by very few real-world observations. The objective of chi-square distributions is to test hypotheses, not to describe real-world distributions. In contrast, most other commonly used distributions, such as normal and Poisson distributions, may explain important things like baby birth weights or illness cases per year.

Because of its close resemblance to the conventional normal distribution, chi-square distributions are excellent for hypothesis testing. Many essential statistical tests rely on the conventional normal distribution.

In statistical analysis, the Chi-Square distribution is used in many hypothesis tests and is determined by the parameter k degree of freedoms. It belongs to the family of continuous probability distributions. The Sum of the squares of the k independent standard random variables is called the Chi-Squared distribution. Pearson’s Chi-Square Test formula is -

Where X^2 is the Chi-Square test symbol

Σ is the summation of observations

O is the observed results

E is the expected results

The shape of the distribution graph changes with the increase in the value of k, i.e. degree of freedoms.

When k is 1 or 2, the Chi-square distribution curve is shaped like a backwards ‘J’. It means there is a high chance that X^2 becomes close to zero.

Courtesy: Scribbr

When k is greater than 2, the shape of the distribution curve looks like a hump and has a low probability that X^2 is very near to 0 or very far from 0. The distribution occurs much longer on the right-hand side and shorter on the left-hand side. The probable value of X^2 is (X^2 - 2).

Courtesy: Scribbr

When k is greater than ninety, a normal distribution is seen, approximating the Chi-square distribution.

## Chi-Square P-Values

Here P denotes the probability; hence for the calculation of p-values, the Chi-Square test comes into the picture. The different p-values indicate different types of hypothesis interpretations.

- P <= 0.05 (Hypothesis interpretations are rejected)
- P>= 0.05 (Hypothesis interpretations are accepted)

The concepts of probability and statistics are entangled with Chi-Square Test. Probability is the estimation of something that is most likely to happen. Simply put, it is the possibility of an event or outcome of the sample. Probability can understandably represent bulky or complicated data. And statistics involves collecting and organising, analysing, interpreting and presenting the data.

## Finding P-Value

When you run all of the Chi-square tests, you'll get a test statistic called X2. You have two options for determining whether this test statistic is statistically significant at some alpha level:

- Compare the test statistic X2 to a critical value from the Chi-square distribution table.
- Compare the p-value of the test statistic X2 to a chosen alpha level.

Test statistics are calculated by taking into account the sampling distribution of the test statistic under the null hypothesis, the sample data, and the approach which is chosen for performing the test.

The p-value will be as mentioned in the following cases.

- A lower-tailed test is specified by: P(TS ts | H0 is true) p-value = cdf (ts)
- Lower-tailed tests have the following definition: P(TS ts | H0 is true) p-value = cdf (ts)
- A two-sided test is defined as follows, if we assume that the test static distribution of H0 is symmetric about 0. 2 * P(TS |ts| | H0 is true) = 2 * (1 - cdf(|ts|))

Where:

P: probability Event

TS: Test statistic is computed observed value of the test statistic from your sample cdf(): Cumulative distribution function of the test statistic's distribution (TS)

## Types of Chi-square Tests

Pearson's chi-square tests are classified into two types:

- Chi-square goodness-of-fit analysis
- Chi-square independence test

These are, mathematically, the same exam. However, because they are utilized for distinct goals, we generally conceive of them as separate tests.

## Properties

The chi-square test has the following significant properties:

- If you multiply the number of degrees of freedom by two, you will receive an answer that is equal to the variance.
- The chi-square distribution curve approaches the data is normally distributed as the degree of freedom increases.
- The mean distribution is equal to the number of degrees of freedom.

## Properties of Chi-Square Test

- Variance is double the times the number of degrees of freedom.
- Mean distribution is equal to the number of degrees of freedom.
- When the degree of freedom increases, the Chi-Square distribution curve becomes normal.

## Limitations of Chi-Square Test

There are two limitations to using the chi-square test that you should be aware of.

- The chi-square test, for starters, is extremely sensitive to sample size. Even insignificant relationships can appear statistically significant when a large enough sample is used. Keep in mind that "statistically significant" does not always imply "meaningful" when using the chi-square test.
- Be mindful that the chi-square can only determine whether two variables are related. It does not necessarily follow that one variable has a causal relationship with the other. It would require a more detailed analysis to establish causality.

## Chi-Square Goodness of Fit Test

When there is only one categorical variable, the chi-square goodness of fit test can be used. The frequency distribution of the categorical variable is evaluated for determining whether it differs significantly from what you expected. The idea is that the categories will have equal proportions, however, this is not always the case.

## SPSS

When you want to see if there is a link between two categorical variables, you perform the chi-square test. To acquire the test statistic and its related p-value in SPSS, use the chisq option on the statistics subcommand of the crosstabs command. Remember that the chi-square test implies that each cell's anticipated value is five or greater.

## Conclusion

In this tutorial titled ‘The Complete Guide to Chi-square test’, you explored the concept of Chi-square distribution and how to find the related values. You also take a look at how the critical value and chi-square value is related to each other.

If you want to gain more insight and get a work-ready understanding in statistical concepts and learn how to use them to get into a career in Data Analytics, our Post Graduate Program in Data Analytics in partnership with Purdue University should be your next stop. A comprehensive program with training from top practitioners and in collaboration with IBM, this will be all that you need to kickstart your career in the field.

Was this tutorial on the Chi-square test useful to you? Do you have any doubts or questions for us? Mention them in this article's comments section, and we'll have our experts answer them for you at the earliest!

## FAQs

#### 1) What is the chi-square test used for?

The chi-square test is a statistical method used to determine if there is a significant association between two categorical variables. It helps researchers understand whether the observed distribution of data differs from the expected distribution, allowing them to assess whether any relationship exists between the variables being studied.

### 2) What is the chi-square test and its types?

The chi-square test is a statistical test used to analyze categorical data and assess the independence or association between variables. There are two main types of chi-square tests:

a) Chi-square test of independence: This test determines whether there is a significant association between two categorical variables.

b) Chi-square goodness-of-fit test: This test compares the observed data to the expected data to assess how well the observed data fit the expected distribution.

### 3) What is the chi-square test easily explained?

The chi-square test is a statistical tool used to check if two categorical variables are related or independent. It helps us understand if the observed data differs significantly from the expected data. By comparing the two datasets, we can draw conclusions about whether the variables have a meaningful association.

#### 4) What is the difference between t-test and chi-square?

The t-test and the chi-square test are two different statistical tests used for different types of data. The t-test is used to compare the means of two groups and is suitable for continuous numerical data. On the other hand, the chi-square test is used to examine the association between two categorical variables. It is applicable to discrete, categorical data. So, the choice between the t-test and chi-square test depends on the nature of the data being analyzed.

#### 5) What are the characteristics of chi-square?

The chi-square test has several key characteristics:

1) It is non-parametric, meaning it does not assume a specific probability distribution for the data.

2) It is sensitive to sample size; larger samples can result in more significant outcomes.

3) It works with categorical data and is used for hypothesis testing and analyzing associations.

4) The test output provides a p-value, which indicates the level of significance for the observed relationship between variables.

5)It can be used with different levels of significance (e.g., 0.05 or 0.01) to determine statistical significance.