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CB-SEM latent interaction: Unconstrained and orthogonalized approaches

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posted on 05.08.2020 by JH Cheah, MA Memon, James Richard, H Ting, TH Cham
© 2020 Australian and New Zealand Marketing Academy Covariance Based – Structural Equation Modelling (CB-SEM) is often used to investigate moderation and latent interaction effects. This study illustrates and compares the application of constrained, unconstrained and orthogonalized CB-SEM approaches to latent variable interaction analysis using AMOS. Although all three techniques provided similar parameter estimates, the orthogonalized approach provided reduced standard errors resulting in identifying a significant latent interaction, suggesting the orthogonalized approach may be better suited for exploratory research. The illustrated example demonstrates three CB-SEM techniques, and the simplicity of the three approaches to test for interaction effects. The three approaches can be comfortably implemented in available software programs. Guidelines and recommendations for the use of the three approaches are identified with a step-wise process of assessing the latent interaction effect in CB-SEM. As far as we are aware this is the first investigation comparing and recommending specific CB-SEM latent variable moderation analysis techniques in marketing research.

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Preferred citation

Cheah, J. H., Memon, M. A., Richard, J. E., Ting, H. & Cham, T. H. (2020). CB-SEM latent interaction: Unconstrained and orthogonalized approaches. Australasian Marketing Journal. https://doi.org/10.1016/j.ausmj.2020.04.005

Journal title

Australasian Marketing Journal

Publication date

01/01/2020

Publisher

Elsevier BV

Publication status

Published

ISSN

1441-3582

Language

en

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