The precision of fractional factorial designs under randomization

Abstract

A regular fraction of a two-level factorial design runs fewer treatment combinations (cells), with more units in each. With the number of units fixed, more units per cell do not by themselves reduce the variance. Averaged over the fractions of one defining contrast subgroup, a fraction's variance is smaller than the full design's by the unit-to-unit variation of the aliased effects, a gain the usual variance estimator misses. Assuming the aliased effects are zero, we propose a full-design estimator that weights the fractions' contrasts by inverse variance. Its estimated variance never exceeds the saturated estimator's. In large samples, it is proportional to the harmonic mean of the fractions' average cell variances, and a fraction's, on average, to the arithmetic mean. We test this assumption, but choosing between the two estimators by the test can lose coverage. The results extend to unequal allocations, and the large-sample results to covariate adjustment.