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Factor rotation with non-negativity constraints

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  • Pudney, Stephen

Abstract

Factor rotation is widely used to interpret the estimated factor loadings from latent variable models. Rotation methods embody a priori concepts of 'complexity' of factor structures, which they seek to minimise. Surprisingly, it is rare for researchers to exploit one of the most common and powerful sources of a priori information: non-negativity of factor loadings. This paper develops a method of incorporating sign restrictions in factor rotation, exploiting a recently-developed test for multiple inequality constraints. An application to the measurement of disability demonstrates the feasibility of the method and the power of non-negativity restrictions.

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  • Pudney, Stephen, 2011. "Factor rotation with non-negativity constraints," ISER Working Paper Series 2011-05, Institute for Social and Economic Research.
  • Handle: RePEc:ese:iserwp:2011-05
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    File URL: https://www.iser.essex.ac.uk/research/publications/working-papers/iser/2011-05.pdf
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