Assessing individual differences in categorical data

In cognitive modeling, data are often categorical observations taken over participants and items. Usually subsets of these observations are pooled and analyzed by a cognitive model assuming the category counts come from a multinomial distribution with the same model parameters underlying all observations. It is well known that if there are individual differences in participants and/or items, a model analysis of the pooled data may be quite misleading, and in such cases it may be appropriate to augment the cognitive model with parametric random effects assumptions. On the other hand, if random effects are incorporated into a cognitive model that is not needed, the resulting model may be more flexible than the multinomial model that assumes no heterogeneity, and this may lead to overfitting. This article presents Monte Carlo statistical tests for directly detecting individual participant and/or item heterogeneity that depend only on the data structure itself. These tests are based on the fact that heterogeneity in participants and/or items results in overdispersion of certain category count statistics. It is argued that the methods developed in the article should be applied to any set of participant 3 item categorical data prior to cognitive model-based analyses.