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EXPLORATORY FACTOR

ANALYSIS (EFA)
Sahar Afshan

Learning Objectives
Understand what is the factor analysis
technique and its applications in research
Discuss exploratory factor analysis (EFA)
Run EFA with SPSS and interpret the resulted
output

SCOPE of Factor Analysis today


Factor analysis and principal component analysis
Carrying out the analyses in SPSS
Deciding on the number of factors
Exploratory and confirmatory FA

Types of Measurement Models


Exploratory (EFA)
Confirmatory (CFA)

EFA vs. CFA

Exploratory Factor Analysis


is concerned with how many
factors are necessary to
explain the relations among
a set of indicators and with
estimation of factor
loadings. It is associated
with theory development.

Confirmatory Factor
Analysis is concerned with
determining if the number of
factors conform to what is
expected on the basis of
pre-established theory. Do
items load as predicted on
the expected number of
factors. Hypothesize
beforehand the number of
factors.

Factor Analysis

Factor Analysis is a method for identifying a structure (or


factors, or dimensions) that underlies the relations
among a set of observed variables.
Factor analysis is a technique that transforms the
correlations among a set of observed variables into
smaller number of underlying factors, which contain all
the essential information about the linear
interrelationships among the original test scores.
Factor analysis is a statistical procedure that involves the
relationship between observed variables
(measurements) and the underlying latent factors.

Factor Analysis

Factor analysis is a fundamental component of Structural


Equation modeling.
Factor analysis explores the inter-relationships among
variables to discover if those variables can be grouped
into a smaller set of underlying factors.
Many variables are reduced (grouped) into a smaller
number of factors
These variables reflect the causal impact of the latent
underlying factors
Statistical technique for dealing with multiple variables

Applications of Factor Analysis


Explore data for patterns.
Often a researcher is unclear if items or variables have a discernible patterns. Factor Analysis can
be done in an Exploratory fashion to reveal
patterns among the inter-relationships of the items.
Data Reduction.
Factor analysis can be used to reduce a large number of variables into a smaller and more
manageable number of factors. Factor analysis can create factor scores for each subject that
represents these higher order variables.
Factor Analysis can be used to reduce a large number of variables into a parsimonious set of few
factors that account better for the underlying variance (causal impact) in the measured
phenomenon.
Confirm Hypothesis of Factor Structure.
Factor Analysis can be used to test whether a set of items designed to measure a certain
variable(s) do, in fact, reveal the hypothesized factor structure (i.e. whether the underlying latent
factor truly causes the variance in the observed variables and how certain we can be about it).
In measurement research when a researcher wishes to validate a scale with a given or
hypothesized factor structure, Confirmatory Factor Analysis is used.
Theory Testing.
Factor Analysis can be used to test a priori hypotheses about the relations among a set of
observed variables.

How would you group these Items?

Exploratory Factor Analysis


In EFA, the researcher
is attempting to explore
the relationships among
items to determine if the
items can be grouped
into a smaller number of
underlying factors.
In this analysis, all items
are assumed to be related
to all factors.

V1
Factor 1

V2

V3
Factor 1

V4

Exploratory Factor Analysis


Factor Loadings:
Measure the relationship between
the items and the factors.
Factor loadings can be interpreted
like correlation coefficients;
ranging between -1.0 and +1.0.
The closer the value is to 1.0,
positive or negative, the stronger
the relationship between the factor
and the item.
Loadings can be both positive
or negative.

V1
Factor 1

V2

V3
Factor 1

V4

Tests for Basic Assumptions


Two statistics on the SPSS output allow you to look at some of the
basic assumptions.
Kaiser-Meyer-Olkin (KMO) Measure of Sampling Adequacy, and
Bartlett's Test of Sphericity
Kaiser-Meyer-Olkin Measure of Sampling Adequacy generally indicates
whether or not the variables are able to be grouped into a smaller
set of underlying factors. That is, will data factor well???
KMO varies from 0 to 1 and should be .60 or higher to proceed (can
us .50 more lenient cut-off)
High values (close to 1.0) generally indicate that a factor analysis may
be useful with your data.
If the value is less than .50, the results of the factor analysis probably
won't be very useful.

Kaiser-Meyer-Olkin (KMO)
Marvelous - - - - - Meritorious - - - - Middling - - - - - - Mediocre - - - - - - Miserable - - - - - Unacceptable - -

.90s
.80s
.70s
.60s
.50s
below .50

KMO Statistics: Interpreting the Output

In this example, the data support the use of factor analysis and suggest that the
data may be grouped into a smaller set of underlying factors.

Eigenvalues greater than 1


Total Variance Explained
Initial Eigenv alues
Factor
1

Total
3.513

Extraction Sums of Squared Loadings

% of Variance Cumulativ e %
29.276
29.276

Total
% of Variance Cumulativ e %
3.296
27.467
27.467

Rotation Sums of Squared Loadings


Total
% of Variance
3.251
27.094

Cumulativ e %
27.094

3.141

26.171

55.447

2.681

22.338

49.805

1.509

12.573

39.666

1.321

11.008

66.455

.843

7.023

56.828

1.495

12.455

52.121

.801

6.676

73.132

.329

2.745

59.573

.894

7.452

59.573

.675

5.623

78.755

.645

5.375

84.131

.527

4.391

88.522

.471

3.921

92.443

.342

2.851

95.294

10

.232

1.936

97.231

11

.221

1.841

99.072

12

.111

.928

100.000

Extraction Method: Principal Axis Factoring.

Criteria For Retention Of Factors

Eigenvalue greater than 1


Single

variable has variance equal to 1

Plot of total variance - Scree plot


Gradual

trailing off of variance accounted for


is called the scree.

Note cumulative % of variance of rotated


factors

Interpretation of Rotated Matrix

Loadings of .40 or higher

Name each factor based on 3 or 4


variables with highest loadings.

Do not expect perfect conceptual fit of all


variables.

Loading size based on sample


(from Hair et al 2010 Table 3-2)
Significant Factor Loadings based on Sample Size
Sample Size

Sufficient Factor Loading

50
60
70
85
100
120
150
200
250
350

0.75
0.70
0.65
0.60
0.55
0.50
0.45
0.40
0.35
0.30

What else?

How do you know when the factor


structure is good?
When

it makes sense and has a (relatively)


simple and clean structure.
Total Variance Explained > .60

How do you interpret factors?


Good

question, that is where the true art of


this comes in.

Why EFA?

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Why EFA?

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