Chapter 16:

Sample Designs
and
Sampling Procedures

Learning Outcomes
After studying we should be able to
Explain reasons for taking a sample rather than a
complete census
Describe the process of identifying a target
population and selecting a sampling frame
Compare random sampling and systematic
(nonsampling) errors
Identify the types of nonprobability sampling,
including their advantages and disadvantages
Summarize the advantages and disadvantages of
the various types of probability samples
Discuss how to choose an appropriate sample
design, aswell as challenges for Internet sampling
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Changing Pocketbook Problems for

Todays Families
It is easy to ask people what they
consider to be the most pressing
financial problems they face.
Low wages
Rising health care and housing costs
Too much debt

When pressed about which financial

problem is most important, some
interesting trends occur.
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Changing Pocketbook Problems for

Todays Families
Each quarter, the Gallup Corporation
develops a representative sample of
approximately 1,000 U.S. adults, aged 18
and older.
Researchers can be 95 percent confident
that the responses of the sample are
reflective of this national population, with
a sampling error of less than 3 percent.
Using telephone based interviews, the
Gallup Corporation asks the respondent to
describe the most important financial
problem facing your family today.
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Changing Pocketbook Problems for

Todays Families
Trends suggest that the most important
financial problem facing families can
often change over time.
In 2008, energy and gas prices was their
most important problem.
In 2009, health care costs was
mentioned.
The use of large-scale representative
samples by the Gallup Corporation
helped reveal these interesting trends.
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Sampling Terminology
A sample is a subset of a larger population.
The purpose of sampling is to estimate an unknown
characteristic of a population.

A population is any complete groupfor

example, of people, sales territories, stores, or
college students.
Shares some common set of characteristics.

Population element refers to an individual

member of the population.
A census is an investigation of all the
individual elements that make up the
population.
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Why Sample?
Pragmatic Reasons:
Budget and time constraints; for example census
of past purchasers reactions of Ford motors.
Sampling cuts costs, reduces labor requirements,
and gathers vital information quickly.

Accurate and Reliable Results: Sample may on

occasion be more accurate than a census since
nonsampling errors may increase during
because of the increased volume of work.
Destruction of Test Units: Especially those in
quality-control testing, require the destruction
of the items being tested. For example, testing
bulbs, blood count.
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Stages in the Selection of a

Sample

Stages in the Selection of a

Sample
1. Defining the Target Population:
One survey concerning organizational buyer
behavior incorrectly defined the population as
purchasing agents whereas industrial engineers
substantially affected buying decisions.

2. The Sampling Frame: A list of elements

from which a sample may be drawn; also
called working population.
A list of all members of Finance Alumni
Association.
In practice, almost every list excludes some
members of the population.
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Stages in the Selection of a

Sample

Sampling frame error: error that occurs when

certain sample elements are not listed or are
not accurately represented in a sampling
frame.
For example university student e-mail directory.

Population elements can be either under- or

overrepresented in a sampling frame.
For example, a savings and loan defined its
population as all individuals who had savings
accounts. However, individuals who had
multiple accounts were overrepresented in the
sample.
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Stages in the Selection of a

Sample
3. Sampling Units: A single element or
group of elements subject to selection
in the sample.
For example, if an airline wishes to sample
passengers, it may take every 25th name on
a complete list of passengers.
Primary Sampling Units (PSU): A unit
selected in the first stage of sampling.
Secondary Sampling Units: selected in the
second stage of sampling.
Tertiary Sampling Units: Selected in the third
stage of sampling.
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Random Sampling Error

The difference between the sample
results and the result of a census
conducted using identical procedures
Statistical fluctuation due to chance
variations means the sampling units,
even if properly selected according to
sampling theory, may not perfectly
represent the population, but generally
they are reliable estimates.
As sample size increases, random
sampling error decreases.
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Systematic Errors
Errors result from nonsampling
factors such as
unrepresentative
sample results
Not due to chance
Due to study design or imperfections
in execution

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Less Than Perfectly Representative

Samples
Sample considering both errors produce less than
perfectly representative samples.

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Two Major Categories of Sampling

Probability sampling:
every member of the population has a
known, nonzero probability of selection.

Nonprobability sampling
Probability of selecting any particular
member is unknown.
Researchers rely heavily on personal
judgment.
No appropriate statistical techniques exist
for measuring random sampling error from
a nonprobability sample.
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Nonprobability Sampling

Convenience
Judgment
Quota
Snowball

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Convenience Sampling
The sampling procedure of obtaining the
people or units that are most conveniently
available.
For example, television stations often present
person-on-the-street
interviews
that
are
presumed to reflect public opinion

Used to obtain a large number of completed

questionnaires quickly and economically.
Used when obtaining a sample through
other means is impractical.
Also called haphazard or accidental sampling

Are best used for exploratory research

when additional research will subsequently
be conducted with a probability sample.
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Judgment Sampling
An experienced individual selects the
sample based on his or her judgment
about some appropriate characteristics
required of the sample member.
Also called purposive sampling.
For example the consumer price index (CPI)
is based on a judgment sample of marketbasket items, housing costs, and other
selected goods and services.

Researchers select samples that satisfy

their specific purposes, even if they are
not fully representative.
Judgment sampling often is used in attempts
to forecast election results.
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Quota Sampling
Ensures that the various subgroups in a
population are represented on pertinent
sample characteristics to the exact extent
that the investigators desire.
It should not be confused with stratified
sampling since the interviewer has a quota
to achieve.
For example, an interviewer in a particular city
may be assigned 100 interviews, 35 with
owners of Sony TVs, 30 with owners of
Samsung TVs, 18 with owners of Panasonic
TVs, and the rest with owners of other brands.
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Quota Sampling
Possible bias:
Quota samples tend to include people who
are easily found, willing to be interviewed,
and middle class.

However offers speed of data collection,

lower costs, and convenience.
Appropriate when the researcher knows
that a certain demographic group is more
likely to refuse to cooperate with a survey.
For instance, if older men are more likely to
refuse, a higher quota can be set for this
group.
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Snowball Sampling
Initial respondents are selected by
probability methods Additional
respondents are obtained from information
provided by the initial respondents.
Used to locate members of rare
populations by referrals.
Suppose a manufacturer of sports equipment
is considering marketing a mahogany croquet
set for serious adult players.

Reduced sample sizes and costs are clearcut advantages of snowball sampling.
Bias is likely to enter into the study
because one is suggesting another.
Appropriate for focus groups.
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Probability Sampling

Simple random sample

Systematic sample
Stratified sample
Cluster sample
Multistage area sample

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Simple Random Sampling

A sampling procedure that ensures
that each element in the population
will have an equal chance of being
included in the sample.
A table of random numbers can be
used.
Widely used.

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Systematic Sampling
A starting point is selected by a random
process and then every nth number on the
list is selected.
Suppose a researcher wants to take a sample of
1,000 from a list of 200,000 names. With
systematic sampling, every 200th name from the
list would be drawn.

The problem of periodicity (the tendency to

recur at intervals) occurs if a list has a
systematic patternthat is, if it is not
random in character.
Collecting retail sales information every seventh
day would result in a distorted sample because
there would be a systematic pattern.
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Stratified Sampling
Characteristics
of
the
samples
are
homogenous
within
the
group
but
heterogeneous across the group.
Strata: Dividing the population into subgroups.
Stratum: Each subgroup is known as stratum.
Choosing strata on the basis of existing
information.
For example, classifying retail outlets based
on annual sales volume.
Then a subsample is drawn using simple
random sampling within each stratum.
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Stratified Sampling
Used to obtain a more efficient sample than a
simple random sampling.
For example, data are collected both from urban
and rural customers.

Random sampling error will be reduced and

sample will accurately reflect the population.
In a proportional stratified sample the number of
sampling units drawn from each stratum is in
proportion to the relative population size of the
stratum.
In a disproportional stratified sample the sample
size for each stratum is not allocated in
proportion to the population size.
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Stratified Sampling

27

Cluster Sampling
The primary sampling unit is not the
individual element in the population but a
large cluster of elements; clusters are
selected randomly.
Economical while retains the characteristics
of a probability sample.
Consider a researcher who must conduct five
hundred personal interviews with consumers
scattered throughout Bangladesh. Travel costs
and time are likely to be enormous. If the product
equally appeals dwellers of Dhaka and Chittagong
then only one cluster can be interviewed.

Ideally a cluster should be heterogeneous.

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Examples of Clusters
Population Element

Possible Clusters in the United States

Airline travelers

Airports
Planes

Sports fans

Football stadiums
Basketball arenas
Baseball parks

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What is the Appropriate Sample

Design?

Degree of accuracy
Resources
Time
Advanced
knowledge
of
population
National versus local
Need for statistical analysis

the

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Internet Sampling is Unique

Internet surveys allow researchers to
rapidly reach a large sample.
Speed is both an advantage and a
disadvantage.
Sample size requirements can be met
overnight or almost instantaneously.
Survey should be kept open long
enough so all sample units can
participate.
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Internet Sampling
Major disadvantage
Lack of computer ownership and Internet
access among certain segments of the
population.

Yet
Internet
samples
may
be
representative of a target populations.
Target population - visitors to a particular
Web site.

Hard to reach subjects may participate.

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End

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