Potential model misspecification bias: Formative indicators enhancing theory for accounting researchers
This paper describes why and when formative factors, in combination with reflective measures, can be used in accounting research to better represent complex theoretical constructs. We argue that the exclusive use of reflective factors constrains theory development and may lead to imprecise measurement. We provide a review of 66 published research papers from Accounting, Organization and Society, The Accounting Review, Contemporary Accounting Research, Auditing: A Journal of Practice & Theory, Accounting, Auditing, & Accountability Journal, Behavioral Research in Accounting, International Journal of Accounting, Journal of Accounting and Public Policy, Management Accounting Research, Abacus, and Journal of Management Accounting Research using Structural Equation Models (SEM) from 1992 to 2008 to illustrate improvement of misspecification bias in leading accounting journals. Our findings suggest that most of the studies modeled constructs that did not include formative indicators.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Baines, Annette & Langfield-Smith, Kim, 2003. "Antecedents to management accounting change: a structural equation approach," Accounting, Organizations and Society, Elsevier, vol. 28(7-8), pages 675-698.
- Van der Stede, Wim A., 2000. "The relationship between two consequences of budgetary controls: budgetary slack creation and managerial short-term orientation," Accounting, Organizations and Society, Elsevier, vol. 25(6), pages 609-622, August.
- Shields, Michael D. & Deng, F. Johnny & Kato, Yutaka, 2000. "The design and effects of control systems: tests of direct- and indirect-effects models," Accounting, Organizations and Society, Elsevier, vol. 25(2), pages 185-202, February.
- Bino Catasús, 2007. "What gets measured gets … on indicating, mobilizing and acting," Accounting, Auditing & Accountability Journal, Emerald Group Publishing, vol. 20(4), pages 505-521, July.
- Jaworski, Bernard J. & Young, S. Mark, 1992. "Dysfunctional behavior and management control: An empirical study of marketing managers," Accounting, Organizations and Society, Elsevier, vol. 17(1), pages 17-35, January.
- Cadez, Simon & Guilding, Chris, 2008. "An exploratory investigation of an integrated contingency model of strategic management accounting," Accounting, Organizations and Society, Elsevier, vol. 33(7-8), pages 836-863.
- Widener, Sally K., 2007. "An empirical analysis of the levers of control framework," Accounting, Organizations and Society, Elsevier, vol. 32(7-8), pages 757-788.
- Libby, Robert & Tan, Hun-Tong, 1994. "Modeling the determinants of audit expertise," Accounting, Organizations and Society, Elsevier, vol. 19(8), pages 701-716, November.
- Widener, Sally K., 2004. "An empirical investigation of the relation between the use of strategic human capital and the design of the management control system," Accounting, Organizations and Society, Elsevier, vol. 29(3-4), pages 377-399.
- Waymond Rodgers & Thomas Housel, 2004. "The effects of environmental risk information on auditors' decisions about prospective financial statements," European Accounting Review, Taylor & Francis Journals, vol. 13(3), pages 523-540.
- Anderson, Shannon W. & Young, S. Mark, 1999. "The impact of contextual and process factors on the evaluation of activity-based costing systems," Accounting, Organizations and Society, Elsevier, vol. 24(7), pages 525-559, October.
- Frank Hartmann, 2005. "The effects of tolerance for ambiguity and uncertainty on the appropriateness of accounting performance measures," Abacus, Accounting Foundation, University of Sydney, vol. 41(3), pages 241-264.
- Hunton, James E. & Wier, Benson & Stone, Dan N., 2000. "Succeeding in managerial accounting. Part 2: a structural equations analysis," Accounting, Organizations and Society, Elsevier, vol. 25(8), pages 751-762, November.
- Bisbe, Josep & Batista-Foguet, Joan-Manuel & Chenhall, Robert, 2007. "Defining management accounting constructs: A methodological note on the risks of conceptual misspecification," Accounting, Organizations and Society, Elsevier, vol. 32(7-8), pages 789-820.
- Franke, George R. & Preacher, Kristopher J. & Rigdon, Edward E., 2008. "Proportional structural effects of formative indicators," Journal of Business Research, Elsevier, vol. 61(12), pages 1229-1237, December.
- Coltman, Tim & Devinney, Timothy M. & Midgley, David F. & Venaik, Sunil, 2008. "Formative versus reflective measurement models: Two applications of formative measurement," Journal of Business Research, Elsevier, vol. 61(12), pages 1250-1262, December.
- Rodgers, Waymond, 1999. "The influences of conflicting information on novices and loan officers' actions," Journal of Economic Psychology, Elsevier, vol. 20(2), pages 123-145, April.
- Jarvis, Cheryl Burke & MacKenzie, Scott B & Podsakoff, Philip M, 2003. " A Critical Review of Construct Indicators and Measurement Model Misspecification in Marketing and Consumer Research," Journal of Consumer Research, Oxford University Press, vol. 30(2), pages 199-218, September.
- Sudarwan, M. & Fogarty, Timothy J., 1996. "Culture and accounting in Indonesia: An empirical examination," The International Journal of Accounting, Elsevier, vol. 31(4), pages 463-481.
- Viator, R. E., 2001. "An examination of African Americans' access to public accounting mentors: perceived barriers and intentions to leave," Accounting, Organizations and Society, Elsevier, vol. 26(6), pages 541-561, August.
- Cheng, Rita Hartung, 1992. "An empirical analysis of theories on factors influencing state government accounting disclosure," Journal of Accounting and Public Policy, Elsevier, vol. 11(1), pages 1-42.
When requesting a correction, please mention this item's handle: RePEc:eee:accoun:v:46:y:2011:i:1:p:25-50. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.