Hypothesis Testing and Multiplicative Interaction Terms

Abstract

When a statistical equation incorporates a multiplicative term in an attempt to model interaction effects, the statistical significance of the lower-order coefficients is largely useless for the typical purposes of hypothesis testing. This fact remains largely unappreciated in political science, however. This brief article explains this point, provides examples, and offers some suggestions for more meaningful interpretation.I am grateful to Tim McDaniel, Anne Sartori, and Beth Simmons for comments on a previous draft.