EFFECT OF ERROR VARIANCE HETEROGENEITY ON THE POWER OF TESTS FOR REGRESSION SLOPE DIFFERENCES

In moderated regression analysis with both a continuous predictor and nominal-level (group membership) variables, there are conditions in which the hypothesis of equal slopes of the regression of Y onto X across groups is equivalent to the hypothesis of equality of X-Y correlations across groups. This research uses those conditions to investigate the impact of heterogeneity of error variance on the power accuracy of the F test for equality of regression slopes. The results show that even when sample sizes are equal, the test is not robust and, under unequal sample sizes, the pattern of excessively high or excessively low rejection rates can be severe.