High Quality Content by WIKIPEDIA articles! CHAID is a type of decision tree technique, based upon adjusted significance testing. The technique was developed in South Africa and was published in 1980 by Gordon V. Kass, who had completed a PhD thesis on this topic. CHAID can be used for prediction as well as classification, and for detection of interaction between variables. CHAID stands for CHi-squared Automatic Interaction Detector, based upon a formal extension of the US AID and THAID procedures of the 1960's and 70's, which in turn were extensions of earlier research, including that performed in the UK in the 1950's. In practice, CHAID is often used in the context of direct marketing to select groups of consumers and predict how their responses to some variables affect other variables, although other early applications were in the field of medical and psychiatric research. Like other decision trees, CHAID's advantages are that its output is highly visual and easy to interpret. Because it uses multiway splits by default, it needs rather large sample sizes to work effectively as with small sample sizes the respondent groups can quickly become too small for reliable analysis.

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