IDEAS home Printed from https://ideas.repec.org/a/taf/japsta/v26y1999i4p435-446.html
   My bibliography  Save this article

Robustness of partial least-squares method for estimating latent variable quality structures

Author

Listed:
  • Claes Cassel
  • Peter Hackl
  • Anders Westlund

Abstract

Latent variable structural models and the partial least-squares (PLS) estimation procedure have found increased interest since being used in the context of customer satisfaction measurement. The well-known property that the estimates of the inner structure model are inconsistent implies biased estimates for finite sample sizes. A simplified version of the structural model that is used for the Swedish Customer Satisfaction Index (SCSI) system has been used to generate simulated data and to study the PLS algorithm in the presence of three inadequacies: (i) skew instead of symmetric distributions for manifest variables; (ii) multi-collinearity within blocks of manifest and between latent variables; and (iii) misspecification of the structural model (omission of regressors). The simulation results show that the PLS method is quite robust against these inadequacies. The bias that is caused by the inconsistency of PLS estimates is substantially increased only for extremely skewed distributions and for the erroneous omission of a highly relevant latent regressor variable. The estimated scores of the latent variables are always in very good agreement with the true values and seem to be unaffected by the inadequacies under investigation.

Suggested Citation

  • Claes Cassel & Peter Hackl & Anders Westlund, 1999. "Robustness of partial least-squares method for estimating latent variable quality structures," Journal of Applied Statistics, Taylor & Francis Journals, vol. 26(4), pages 435-446.
  • Handle: RePEc:taf:japsta:v:26:y:1999:i:4:p:435-446
    DOI: 10.1080/02664769922322
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/02664769922322
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Dijkstra, Theo, 1983. "Some comments on maximum likelihood and partial least squares methods," Journal of Econometrics, Elsevier, vol. 22(1-2), pages 67-90.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Thai, Mai Thi Thanh & Turkina, Ekaterina, 2014. "Macro-level determinants of formal entrepreneurship versus informal entrepreneurship," Journal of Business Venturing, Elsevier, vol. 29(4), pages 490-510.
    2. Ringle Christian M. & Götz Oliver & Wetzels Martin & Wilson Bradley, 2009. "On the Use of Formative Measurement Specifications in Structural Equation Modeling: A Monte Carlo Simulation Study to Compare Covariance-Based and Partial Least Squares Model Estimation Methodologies," Research Memorandum 014, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
    3. Teo, Thompson S.H. & Lin, Sijie & Lai, Kee-hung, 2009. "Adopters and non-adopters of e-procurement in Singapore: An empirical study," Omega, Elsevier, vol. 37(5), pages 972-987, October.
    4. Ashill, Nicholas J. & Rod, Michel, 2011. "Burnout processes in non-clinical health service encounters," Journal of Business Research, Elsevier, vol. 64(10), pages 1116-1127, October.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:japsta:v:26:y:1999:i:4:p:435-446. 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: (Chris Longhurst). General contact details of provider: http://www.tandfonline.com/CJAS20 .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.