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# Structural Equation Modeling (SEM)

The Structural Equation Modeling or SEM is a second generation multivariate statistical analysis developed for analyzing the inter-relationships among multiple variables in a model simultaneously. SEM is a powerful statistical technique to solve the following requirements:
1) Analyzing the model with latent constructs 2) Running the Confirmatory Factor Analysis (CFA) 3) Analyzing multiple equations simultaneously 4) Analyzing regressions with multicollinearity problem 5) Analyzing the path analysis with multiple dependents 6) Estimating the correlation and covariance in a model 7) Modeling the inter-relationships simultaneously in a model 8) Modeling and testing the mediating variables in a model 9) Analyzing and testing the moderating variables in a model

## HISTORY OF MULTIVARIATE ANALYSIS METHODS Type of Analysis Exploratory

First Generation (1900-1990) 1. Exploratory Factor Analysis (EFA) 2. Cluster Analysis 3. Multidimensional Scaling

Confirmatory
1. ANOVA 2. Logistic Regression 3. Multiple Regression

## Second Generation (1990-Now)

Variance Based SEM Covariance Based SEM Partial Least Square (PLS) (AMOS, LISRELL, etc) Confirmatory Factor Analysis (CFA) (AMOS, LISRELL, etc)

AMOS is an acronym for Analysis of Moments Structures. This is one of the newest software developed for Structural Equation Modeling (SEM). The researchers could employ AMOS Graphic to model and analyze the inter-relationships among latent constructs effectively, accurately, and efficiently. More importantly, the multiple equations of inter-relationships in a model are computed simultaneously.

## Comparison between Variance-Based SEM and Covariance-Based SEM

Estimator Used Research Objective Statistical Approach Model Assessment

VB-SEM
PLS

OLS:
Ordinary

## Least Squares -Predicting

CB-SEM
AMOS

MLE:
Maximum Likelihood Estimator

-Confirmatory Develop based in Nature -Theory Testing -Comparing Theories on Parametric Approach