Structural Equation Modelling

(SEM)
An Introduction (Part 3)
CFA Models: Important Steps
Model Specification
Model Identification
Model Estimation
Assessment of Model Fit
Model Re-specification
Step 1: Model Specification
SEM is a confirmatory technique and it
Needs a model that delineates the relationships among variables

Requires a model that is based on theory (Bollen & Long, 1993)

Step 1: Model Specification
Exogenous variables
Variables whose causes are unknown and/or not included in the
model
Variables that explain other variables in the model (i.e. independent
variables (IVs))

Endogenous variables
Variables that serve as DVs in a model
May also serve as IVs
Step 2: Model Identification
Model must be specified so that there are enough pieces of information to give unique
estimates for all parameters

SEM involves estimating unknown parameters (e.g., factor loadings, path coefficients)
based on known parameters (i.e., covariances)

Identification involves whether a unique solution for a model can be obtained

Requires more known vs. unknown parameters

Identification is a property of the model, not the data

Does not depend on sample size
i.e., if a model is not identified, it remains so regardless of whether the sample size is
100, 1000, 10,000, etc.
Step 3: Model Estimation
Over-identified models have infinite # of solutions.
Parameters need to be estimated based on a mathematical criterion.
Goal is to minimize differences between the observed and implied covariance
matrices.
Process begins with initial estimates- start values.
Is an iterative process will stop when a minimum fitting criterion is
reached.
When the difference between the observed and implied covariance
matrices are minimized
Step 4: Assessing Model Fit

Absolute fit
Relative (Comparative) fit
Common Absolute Fit Indices
Model X2*
Non-significant X2 (p>0.05) indicates good fit

Root Mean Squared Error of Approximation (RMSEA)

Acceptable fit < 0.10; good fit < 0.05

Goodness of Fit (GFI)

> 0.90 is considered good fit
Common Relative Fit Indices

Normed Fit Index (NFI)

Incremental Fit Index (IFI)
Comparative Fit Index (CFI)

All range 0-1

Generally, >0.90 is considered good
SEM Model Fit: Rules of Thumb
Will often see/hear reference to 0.90 or above indicating acceptable model
fit, for indices such as GFI, CFI, NFI, etc.
Typically cite Bentler & Bonett (1980) for this assertation

Basis for this is rather thin (Lance et al., 2006)

What Bentler and Bonett (1980) actually said:

experience will be required to establish values of the indices that are
associated with various degrees of meaningfulness of results. In our
experience, models with overall fit indices of less than 0.90 can usually
be improved substantially (Bentler & Bonett, 1980, p. 600).
Step 5: Model Re-specification/Modification
Goal is to improve model fit changing the model to fit the data

Caveats
Modifications are post hoc & capitalize on chance!

General guidelines
Must be theoretically consistent
Must be replicated with new data
Evaluating Your Model
Theoretical/clinical meaning
Guiding principle
Residuals and implied correlations
Discrepancies between sample covariance matrix and those implied
by the model
Tests of path coefficients
Direction, magnitude
Absence of numerical problems
Direction and magnitude of residuals
Pattern of standardized residuals (z-scores)
 Looking for Online SEM
Training?
Contact us: info@costarch.com
Visit: http://tinyurl.com/costarch-sem
www.costarch.com