Types of parameters in SEM

During model specification, you must make decisions about how to treat your parameters. Specifically, you
must decide on what parameters should be freely estimated (i.e., free parameters), what parameters
should be fixed at a particular value (fixed parameters), and/or whether certain sets of parameters should
have constraints placed on their estimation (constrained parameters). The choices you make regarding how
to treat individual parameters within a model will impact your understanding of the relationships among
variables within and between populations, and will play a role in achieving model identification.

All examples in this demonstration use a basic multiple regression model, although the concepts apply to
all forms of models you could theoretically run using SEM. Also, this demonstration is based on a
covariance matrix from an example in chapter 5 of Schumacker & Lomax (2016). The matrix summary did
not contain means. Although the examples here involve tests of path coefficients and variances, the
concepts are also applicable when testing means and intercepts in SEM.
 Here, we have an example of a multiple regression model specified in AMOS.

Here, we have the same model after naming all the free parameters. In
other words, AMOS is attempting to derive unique estimates of all of
these parameters.

The path from the error term to the endogenous variable (“deference”), however, has been fixed to 1.0. In other
words, this parameter is not freely estimated. In general, all endogenous variables within a model will have an error
term with path coefficients fixed at 1.0. Treating these paths as free will result in problems with model identification.
When we run our model, we obtain
estimates of each of these parameters
(see below right).

Is it also the case that we have a just-

identified model (as df=0)
Here we have an output file will all the labeled, but freely
estimated parameters and their associated tests.
In theory, we could fix other parameters
within our model to certain values and
carry out model tests. Let’s see what
happens when we fix the regression slope
from age to deference to .22.
 Before fixing path coefficient After fixing path coefficient

While this didn’t impact the estimation of the variances and covariance of the exogenous variables
(age and deference), it did impact the estimation of the path from years to deference as well as the
estimated error variance associated with deference.

Also notice that the model is now over-identified as the df = 1 (i.e., > 0).
Not estimated
Because the model is over-identified, we can interpret the fit statistics. All indicate very poor fit of the
model to the data.
Because the model with this fixed path coefficient is nested where all paths are freely estimated, the chi-
square test can be interpreted as a test of change in model fit from the previous model to the current
one. As we see, the change in fit was significant, indicating a significant worsening in fit due to fixing that
path coefficient to .22.
Let’s see what happens when we fix the path coefficient to -.06 (much more in line with the original estimate).
Before fixing path coefficient After fixing path coefficient

Here, we see another change in the error variance and the coefficient for path b. The model is still
overidentified, as df=1. However, the chi-square value is much lower – suggesting a better fitting
model.
The fit statistics for this model generally suggests good fit (although RMSEA is high).
Let’s compare the residual matrices from our three models…
Model 1 (just-identified): Perfectly reproduced the
elements within the sample covariance matrix.
Model 2 (over-identified after fixing path a to .22): There
is evidence of substantial model misspecification,
indicated by the large standardized residual for the
relation between age and deference. The large residual
for deference indicates serious problems with the
estimation of the variance of the prediction errors.
Model 3 (over-identified after fixing path a to -.06):
There is less evidence of model misspecification. We see
that the standardized residuals for the age-deference
relation and the variance for deference are much smaller
than they were in Model 2.
The estimation of parameters can be constrained as well. A common type of constraint in SEM is equality of
parameter estimates (i.e., equality constraint). This is often used in multigroup SEM analyses, but can also be
applied when analyzing data in a single group.

Let’s see what happens when we place an equality constraint on both of our path coefficients.

In AMOS, when you provide the same name

for two parameters, this constrains the
estimation of those two parameters to
equality.
The path coefficients from age and years to deference are both
constrained to equality. The path coefficients for both predictors is
-.08.

You also see that we have another over-identified model, as df =

1.

And it turned out that the fit statistics suggested a very good
fitting model. And the chi-square test basically indicates that the
constrained model fits the data no worse than a fully
unconstrained model (i.e., parameters are freely estimated).

The model does a

good job of
reproducing the
sample covariance
matrix.
Here, the path coefficients are constrained to equality.
Let’s try another model, imposing equality constraints on both the path coefficients and the variances of
our exogenous variables.
Let’s try another model, imposing equality constraints on both the path coefficients and the variances of
our exogenous variables.

This model is a very poor fit to the data.