Q What are sampling techniques? Briefly explain the cluster sampling technique.

A Sampling Techniques:-





Cluster Sampling -: Consider that we want to estimate health insurance coverage in Baltimore city. We could take a
random sample of 100 households (HH). In that case, we need a sampling list of Baltimore HHs. If the list is not
available, we need to conduct a census of HHs. The complete coverage of Baltimore city is required so that all HHs
are listed, which could be expensive. Furthermore, since our sample size is small compared to the numbers of total
HHs, we need to sample only few, say one or two, in each block (subdivisions). Alternatively, we could select 5
blocks (say the city is divided into 200 blocks), and in each block interview 20 HHs. We need to construct HH listing
frame only for 5 blocks (less time and costs needed). Furthermore, by limiting the survey to a smaller area,
additional costs will be saved during the execution of interviews.
Such sampling strategy is known as cluster sampling.

Definition:-
In cluster sampling, cluster, i.e., a group of population elements, constitutes the sampling unit, instead
of a single element of the population.

The main reason for cluster sampling is cost efficiency (economy and feasibility), but we compromise with
variance estimation efficiency

Advantages:
Generating sampling frame for clusters is economical, and sampling frame is often readily
available at cluster level
Most economical form of sampling
Larger sample for a similar fixed cost
Less time for listing and implementation
Also suitable for survey of institutions
.
Disadvantages:
May not reflect the diversity of the community.
Other elements in the same cluster may share similar characteristics.
Provides less information per observation than an SRS of the same size (redundant information: similar
information from the others in the cluster).
Standard errors of the estimates are high, compared to other sampling designs with same sample size

Need to consider the sampling order:
Primary sampling units (PSU): clusters
Secondary sampling units (SSU): households/individual elements

We may select the PSUs by using a specific element sampling techniques, such as simple random
sampling, systematic sampling or by PPS sampling.

We may select all SSUs for convenience or few by using a specific element sampling techniques (such as
simple random sampling, systematic sampling or by PPS sampling).

Simple one-stage cluster sample:
List all the clusters in the population, and from the list, select the clusters usually with simple random
sampling (SRS) strategy. All units (elements) in the sampled clusters are selected for the survey.

Simple two-stage cluster sample:
List all the clusters in the population. First, select the clusters, usually by simple random sampling (SRS).
The units (elements) in the selected clusters of the first-stage are then sampled in the second-stage,
usually by simple random sampling (or often by systematic sampling).

Multi-stage sampling:
When sampling is done in more than one stage.
In practice, clusters are also stratified.

Estimation for cluster sampling
Let yij = measurement for j-th element (SSU) in i-th cluster (PSU).

In the simple case of equal-sized clusters (although may be unrealistic), the total number of elements in
the population,

K= N*M, where Mi=M (constant for all the clusters)
If the clusters are of unequal sizes, the total number of elements in the population.



Q5. Explain the classical approach to the probability theory. Also explain the limitation of classical
definition of probability.

A5. The classical theory of probability bases all probability distributions on assigning equal
probabilities to equally possible alternatives. This theory has been claimed to be both
inconsistent and circular. Related to the classical theory is the principle of indifference. This
principle states that if we have no reason to think one alternative is more likely than another
then they should be assigned an equal probability. It is largely because of the paradoxes raised
against this principle that the classical theory is perceived to be inconsistent.

The historical birth of probability in the 17th century was centered primarily on
gambling and games of chance. These settings were a natural background for the
development of what is nowadays known as the classical theory of probability.
The classical theory begins by considering a set of equally possible alternatives and
assigning each of them an equal probability. The probability of any other event is then
calculated as the ratio between the alternatives falling under this event and the
original set of alternatives.


The early theorists of probability, whose work is now referred to as Classical Theory, were
primarily concerned with games of chance involving fair devices such as dice, cards and coins.
A important issue for classical theory was the assumption of fairness, or equiprobability of
outcomes, first justified by appeal to physical features of the gambling tools such as symmetry
or evenly-distributed weight, and later formalized by an axiom referred to today as the Principle
of Indifference (or the Principle of Insufficient Reason as Keynes put it).

Bayesian Approach
According to the subjective interpretation of probability, the probability that a person assigns to
some outcome represents her own judgment of the likelihood that the outcome will occur.
Thus, if you and I have different beliefs, we will assign different subjective probabilities to a set
of outcomes.
This approach is a powerful way to mathematically incorporate the subjectivity of scientific
research into the data analysis process, but it is not without its limitations.
First, it can be difficult in many real world applications to express prior beliefs (or priors) in
numerical terms that allow for the required calculations. Moreover, it is unlikely that all people
or researchers have beliefs about the world that meet the strict requirements of probability
theory. Additionally, until very recently, much Bayesian analysis was practically impossible due
to computational limitations.