The maximum income level able to be reported creates a "ceiling" that results in measurement inaccuracy, as the dependent variable range is not inclusive of the true values above that point.
The ceiling effect can occur any time a measure involves a set range in which a normal distribution predicts multiple scores at or above the maximum value for the dependent variable.
A ceiling effect in data-gathering, when variance in a dependent variable is not measured or estimated above a certain level, is a commonly encountered practical issue in gathering data in many scientific disciplines.
When a ceiling effect occurs in data-gathering, there is a bunching of scores at the upper level reported by an instrument.
[3] Response bias occurs commonly in research regarding issues that may have ethical bases or are generally perceived as having negative connotations.
[4] Participants may fail to respond to a measure appropriately based on whether they believe the accurate response is viewed negatively.
A population survey about lifestyle variables influencing health outcomes might include a question about smoking habits.
The attempted prevention of response bias, in the case of the smoking habit survey, leads to ceiling effects through the basic design of the measure.
This will result in a ceiling effect due to the grouping of respondents into the single maximum category, which prevents an accurate representation of the deviation beyond that point.
[5] A ceiling effect is said to occur when a high proportion of subjects in a study have maximum scores on the observed variable.
In cognitive psychology, mental processes such as problem solving and memorization are studied experimentally by using operational definitions that allow for clear measurements.
[7] However, this clustering could actually represent a natural physiological limit of response time, rather than an artifact of the stopwatch sensitivity (which of course would be a ceiling effect).
Had the arithmetic test included additional, more difficult items, Joe might have gotten 30 points on that subtest, producing a "true" score of 30+10+10 or 50.
Writings on gifted education bring up two reasons for supposing that some IQ scores are underestimates of a test-taker's intelligence: Ceiling effects on measurement compromise scientific truth and understanding through a number of related statistical aberrations.
If researchers are using a design that is not previously validated, a combination of surveys, involving that originally-proposed and another supported by past literature, may be used to assess for the presence of ceiling effects.