4e PLSPM

Introduction to Structural Equation Modelling
Partial Least Squares Path Modelling

(PLSPM)
Joaqun Alds Manzano
Universitat de Valncia
*joaquin.aldas@uv.es
Partial Least Squares (PLS)
In 1960 Karl Jreskog proposed an algorithm to estimate covariance based

structural models: maximum likelihood algorithm (ML)
in 1970 ML algorithm was made operational in the first widely used
commercial software: LISREL
Herman Wold (Jreskog thesis supervisor) questioned the applicability of
covariance structure models estimation via ML because of its heavy
distribution assumptions and high sample sizes needed.
Wold proposed an alternative approach to these situations: Partial Least
Squares
The first general PLS algorithm Wold (1973) offered was called NIPALS
(=Non linear Iterative PArtial Least Squares) and a final presentation of the
PLS approach to path modelling with latent variables is present in Wolds
(1982) paper.
Partial Least Squares

Covariance based SEM rationale
X1
X2
X3
X1
1.00
X2
.087
1.00
X3
.140
.080
1.00
X4
.152
.143
.272
X4
1.00

Covariance based SEM rationale
X1
.83
.33 .26
.46 .59
X2
X3
X1
1.00
X2
.087
1.00
X3
.140
.080
1.00
X4
.152
.143
.272
X4
1.00
0.33 0.26 = 0.085 ; 0.087 = X1 X 2
0.33 0.83 0.46 = 0.126 ; 0.140 = X1 X 3

CBSEM solution vs. PLSPM solution
.83
.33 .26
.22
.46 .59
CBSEM solution
.75 .60
.54 .71
PLSPM solution


Terminology
Errors
Independent
Latent variable
Dependent
Latent variable
Independent
Latent variable
Manifest variables or indicators of

the independent construct
Manifest variables or indicators of

the dependent construct

Terminology
Weights
Loadings

PLSPM algorithm rationale
(Fornell, Barclay & Rhee, 1988; Wold, 1966)
Initialization
Inner weights estimation
Inside approximation
Outer weights estimation
Outside approximation
Stop criterion
Estimation of loadings,
weights and path coefficients
Raw
data
Manifest variable
indicators

Initialization
is calculated
adding its indicators
(weights and
loadings = 1)
Step1
!1outer = x11 + x12

!2outer = x21 + x22
! outer = x + x + x
3
31
32
33
w11 = w12 = w21 = w31 = w32 = w33 = 1
10

Inner weights estimation
Step 2
Covariance
between adjacent
LV is calculated
" cov(! outer , ! outer ) ! ,! adjacent

$
i
j
i
j
eij = #
$%
0
rest of cases
11

Inner approximation
LV estimation
from their
previous outer
estimation
Step 3
!iinner = " eij! outer

j
j
#!1inner = e13!3outer
%% inner
outer
$!2 = e23!3
% inner
outer
outer
!
=
e
!
+
e
!
%& 3
13 1
23 2
12

Paso 4
Weights and
loading estimation
x jh = c jh + w jh! inner
+ " jh
j
# x31 = c31 + w31!3inner + " 31
%%
inner
$ x32 = c32 + w32!3 + " 32
%
inner
x
=
c
+
w
!
+ " 33
%& 33
33
33 3
' w 31 , w 32 , w 33
Reflective
13

Paso 4
Weights and
loading estimation
! inner
= c j + " w jh x jh + # j
j
h
$&!1inner = c1 + w11 x11 + w12 x12 + #1

% inner
&'!2 = c2 + w21 x21 + w22 x22 + # 2
( w 11 , w 12 , w 21 , w 22
Formative
14

Outer approximation
Step 5
is calculated from
the last loadings &
weights estimation
outer
= w jh x jh
j
h
1outer = w11 x11 + w12 x12

outer
2 = w21 x21 + w22 x22
outer
3 = w31 x31 + w32 x32 + w33 x33
15

Stop criterion
Step 6
"
We stop iterating
if stop criterion
holds
k
k !1
w(jh ) ! w(jh ) < 10!5
h, j
k
k !1
k
k !1
w11( ) ! w11( ) + w12( ) ! w12( ) +
(k )
( k !1)
(k )
( k !1)
w21
! w21
+ w22
! w22
+
(k )
( k !1)
(k )
( k !1)
(k )
( k !1)
w31
! w31
+ w32
! w32
+ w33
! w33
< 10!5
16

Final estimation
Step 7
! j = ! outer
j
Final parameter
estimation is
performed
Latent variable scores
x jh = c jh + ! jh" j + # jh
" j = c j + % $ jh x jh +# j
reflective
Loadings
formative
Weights
! j = # " ij!i +$ j
Structural paths
17

PLSPM specification restrictions
Structural part of the model must be recursive

Non-recursive paths are not allowed
No logical loops
Each latent variable must be connected at least to another LV (*)
Each LV must be measured by at least one indicator (second order factors?)
An indicator can be associated only to one LV
The model cannot be formed by non-connected blocks (*)
(*) SmartPLS restrictions, not necessarily PLSPM restrictions
18

When using PLSPM instead of CBSEM?
Chin y Newsted (1999; p.337)
Small although representative sample sizes (to be clarified)

The phenomenon in question is relatively new or changing and
the theoretical model or measures are not well formed,
The data conditions relating to normal distribution,
independence, and/or sample size are not met
There is an epistemic need to model the relationship between
LVs and indicators using reflective measures
The objective is prediction
19

What means a small sample size?
Minimum sample size is 10 times the higher of the
previous calculations:
5 10 = 50
Higher number or LV that point to a dependent

LV (3)
Number of indicators of the most complex

forrmative LV (5)
20

What means a small sample size?
Chin & Newsted (1999; p.314); Hair, Anderson, Tatham & Black (1995; p.2 y p.10-13)
Previous criterion is the classical rule of thumb, but power analysis must be
considered
Test power:
Probability of rejecting the null hypothesis when it is false
(Type I error): probability of rejecting the null hypothesis when it is true
(Type II error): probability of not rejecting the null hypothesis when it is
false
1 (Power): probability of rejecting the null hypothesis when it is false
In Social Sciences, Minimum 80% (Cohen, 1988)
Does the previous rule of thumb meet this criterion?
For 5 predictors (our model), =.05 y and a moderate effect size, the power of
the test would be:
N
1
20
.16
40
.37
50
.47
60
.57
100
.84
L
21

Recommendation for performing power analysis
Use a good power analysis software like G*Power

Can be downloaded for free at:
http://www.psycho.uni-duesseldorf.de/abteilungen/aap/gpower3/
Read the paper:
Faul, F., Erdfelder, E., Lang, A.-G., & Buchner, A. (2007). G*Power 3: A
flexible statistical power analysis program for the social, behavioral, and
biomedical sciences. Behavior Research Methods, 39, 175-191.
22

An annotated example
Sanz, Ruiz, Alds (2008)
23

Data screening
Missing data imputation with adequate software, as listwise deletion is the
default for SmartPLS and only media imputation is available in actual beta.
Draw the model
Run the model
Very few options
Only weighting scheme is configurable (marginal effect on the result)
Validating the measurement model
LV Reliability (Cronbachs alpha)
LV Reliability (Composite reliability)
Convergent validity (loadings size and significance, AVE, cross-loadings)
Discriminant validity (AVE vs. LV correlation)
Structural model evaluation
Explained variance of dependent LV (R squared)
Predictive relevance (Q2 using blindfolding)
Structural paths significance (bootstrapping)
Global fit
No indices
24

Data screening
Missing data imputation with adequate software, as listwise deletion is the
default for SmartPLS and only media imputation is available in actual beta.
Missing value coding schema must be indicated to the software. -1 coding used here
25

Draw the model
26

Run the model

Very few options
Only weighting scheme is configurable (marginal effect on the result)
27

Reliability (Cronbachs alpha)

Benchmark >.70 (Nunnally & Bernstein, 1994)
Composite reliability (Wets, Linn, Joreskog, 1974; Fornell & Larcker, 1981)
Only applied to reflective constructs, not to formative ones (Chin, 1998)
Benchmark > 0.6 (Bagozzi & Yi, 1988)
Calculated for each LV
CR =
L
ij
L
- ij + - Var Eij
j
j
( )
Where Lij is the standardized loading of item j on factor i

Var (Eij) is the error variance, calculated as:
( )
Var Eij = 1 ! Lij2

28


ACTITUD
DEP1
DEP2
DEP3
DEP4
DEP5
DEP6
p.03.01
p.03.02
p.03.03
p.03.04
p.03.05
p.03.06
p.03.07
p.03.08
p.03.09
p.03.10
p.03.11
p.03.12
p.04.01
p.04.02
p.04.03
p.04.04
p.04.05
p.04.06
p.04.07
p.04.08
p.04.09
p.04.10
p.05
DEPEND
0,5274
0,3278
0,4300
0,9250
0,6135
0,5955
FACUSO
INTCOMP
UTIPER
Outer loadings
0,5714
0,7917
0,8203
0,8098
0,7766
0,7976
0,8198
0,4614
0,6897
0,7444
0,3946
0,7441
CR=.8938
0,6060
0,6617
0,2838
0,7607
0,8330
0,8042
0,7570
0,5889
0,4969
0,6737
1,0000
(0.5714 + 0.7917 + 0.8203 + 0.8098 + 0.7766 + 0.7976)

CR =
(0.5714 + 0.7917 + 0.8203 + 0.8098 + 0.7766 + 0.7976) + (1! 0.5714) + (1! 0.7917) + (1! 0.8203)
2
+ (1! 0.8098) 2 + (1! 0.7766) 2 + (1! 0.7976) 2
= 0.8938
29

ACTITUD
DEPEND
FACUSO
INTCOMP
UTIPER
SmartPLS automatically calculates CR and Cronbachs alphas:
AVE Composite Reliability R Square Cronbachs Alpha

0,4425
0,8823 0,4375
0,8518
0,4047
0,4374
0,8148
0,7616
1,0000
1,0000 0,3210
1,0000
0,5869
0,8938 0,2401
0,8557
Communality
0,4425
0,3595
0,4374
1,0000
0,5869
Redundancy
0,0708
0,0412
0,1940
0,1402
30

Reliability
Average Variance Extracted criterion (Fornell & Larcker, 1981):
!L
ij
AVEi =
!L
ij
( )
+ !Var Eij
j
Same notation CR
Benchmark > 0,5 (Fornell & Larcker, 1981)
Only for reflective LV, not formative ones (Chin, 1998)
31


ACTITUD
DEP1
DEP2
DEP3
DEP4
DEP5
DEP6
p.03.01
p.03.02
p.03.03
p.03.04
p.03.05
p.03.06
p.03.07
p.03.08
p.03.09
p.03.10
p.03.11
p.03.12
p.04.01
p.04.02
p.04.03
p.04.04
p.04.05
p.04.06
p.04.07
p.04.08
p.04.09
p.04.10
p.05
AVE =
DEPEND
0,5274
0,3278
0,4300
0,9250
0,6135
0,5955
FACUSO
INTCOMP
UTIPER
Outer loadings
0,5714
0,7917
0,8203
0,8098
0,7766
0,7976
0,8198
0,4614
0,6897
0,7444
0,3946
0,7441
AVE=.5869
0,6060
0,6617
0,2838
0,7607
0,8330
0,8042
0,7570
0,5889
0,4969
0,6737
1,0000
0.57142 + 0.7917 2 + 0.82032 + 0.80982 + 0.77662 + 0.79762

= 0.5896
0.5714 + 0.7917 + 0.8203 + 0.8098 + 0.77662 + 0.79762 + (1 ! 0.5714)2 + (1 ! 0.7917)2 + (1 ! 0.8203)2 + (1 ! 0.8098)2 + (1 ! 0.7766)2 + (1 ! 0.7976)2
2
32

ACTITUD
DEPEND
FACUSO
INTCOMP
UTIPER
SmartPLS automatically calculates AVE

0,4425
0,8823 0,4375
0,8518
0,4047
0,4374
0,8148
0,7616
1,0000
1,0000 0,3210
1,0000
0,5869
0,8938 0,2401
0,8557
Communality
0,4425
0,3595
0,4374
1,0000
0,5869
Redundancy
0,0708
0,0412
0,1940
0,1402
33

Convergent validity (Same criteria than those from SEM)

Benchmark > 0.7 (Carmines & Zeller, 1979)
Some researchers believe this criterion is too strict when new scales are
being developed (Barclay, Higgins, Thompson, 1995; Chin, 1998)
Bagozzi & Yi (1988), for instance, propose > 0.6
Notice! Formative constructs are evaluated in terms of their weights
(Chin, 1998), focusing in their significance and not in their size.
Multicollinearity must be tested.
And what about significance? We will go back to it later.
34


ACTITUD
DEP1
DEP2
DEP3
DEP4
DEP5
DEP6
p.03.01
p.03.02
p.03.03
p.03.04
p.03.05
p.03.06
p.03.07
p.03.08
p.03.09
p.03.10
p.03.11
p.03.12
p.04.01
p.04.02
p.04.03
p.04.04
p.04.05
p.04.06
p.04.07
p.04.08
p.04.09
p.04.10
p.05
DEPEND
0,5274
0,3278
0,4300
0,9250
0,6135
0,5955
FACUSO
INTCOMP
UTIPER
0,5714
0,7917
0,8203
0,8098
0,7766
0,7976
Formative constructs:
focus on WEIGHTS
not on loadings
UTIPER1 should be
dropt off
0,8198
0,4614
0,6897
0,7444
0,3946
0,7441
0,6060
0,6617
0,2838
0,7607
0,8330
0,8042
0,7570
0,5889
0,4969
0,6737
1,0000
Outer loadings
35

Convergent validity
In SEM Lagrange multiplier test allowed us to detect items with
significant loadings in more than one LV, what is a threat to convergent
validity
PLS offers cross-loadings of one indicator on all the LV. If the loading of
one item on a factor different to the one it was designed for is higher
than the loading on that factor, the item should be deleted.
Directly calculated by SmartPLS.
Only apply to reflective constructs.
36


DEP1
DEP2
DEP3
DEP4
DEP5
DEP6
p.03.01
p.03.02
p.03.03
p.03.04
p.03.05
p.03.06
p.03.07
p.03.08
p.03.09
p.03.10
p.03.11
p.03.12
p.04.01
p.04.02
p.04.03
p.04.04
p.04.05
p.04.06
p.04.07
p.04.08
p.04.09
p.04.10
p.05
ACTITUD
0,2843
0,2736
0,3092
0,4620
0,3779
0,3635
0,4120
0,5003
0,4848
0,5004
0,4686
0,5295
0,3378
0,0874
0,2638
0,3360
0,0771
0,3617
0,6060
0,6617
0,2838
0,7607
0,8330
0,8042
0,7570
0,5889
0,4969
0,6737
0,4981
DEPEND
0,5274
0,3278
0,4300
0,9250
0,6135
0,5955
0,2931
0,5620
0,5152
0,4562
0,4622
0,4980
0,3596
0,0832
0,2390
0,3571
0,0938
0,3942
0,3289
0,4683
0,1295
0,3674
0,4246
0,4296
0,3454
0,2390
0,2470
0,3567
0,4096
FACUSO
0,2783
0,0460
0,1283
0,4160
0,2156
0,2098
0,2941
0,4143
0,4089
0,4371
0,3351
0,3454
0,8198
0,4614
0,6897
0,7444
0,3946
0,7441
0,1553
0,4597
0,0061
0,2600
0,3923
0,4008
0,1740
0,2127
0,0919
0,3685
0,4597
INTCOMP
0,2490
0,0335
0,0911
0,3823
0,1844
0,2053
0,3414
0,4306
0,3886
0,4497
0,3521
0,4032
0,3756
0,2349
0,3333
0,3577
0,1633
0,3155
0,2226
0,3545
-0,0157
0,3728
0,3995
0,4752
0,3224
0,3278
0,2122
0,3572
1,0000
UTIPER
0,2735
0,2142
0,2691
0,5852
0,3926
0,3636
0,5714
0,7917
0,8203
0,8098
0,7766
0,7976
0,3862
0,0687
0,3174
0,3976
0,0000
0,4214
0,3559
0,4331
0,1166
0,4526
0,5403
0,5991
0,3754
0,4138
0,3280
0,3683
0,5168
UTIPER
FACUSO
ACTITUD
37

Discriminant validity
Average variance extracted criterion (Fornell & Larcker, 1981)
One LV should share more variance with its indicators than with other LV
Squared correlation between two LV must be compared to the AVE of
each of the factors
Discriminant validity holds if:
AVEi > !ij2

AVE j > !ij2
Only applies to reflective constructs, not formative ones (Chin, 1998)
38

SmartPLS offers all the information we need: AVE for each latent variable and
the correlations among factors
ACTITUD
DEPEND
FACUSO
INTCOMP
UTIPER
AVE
0,4425
0,0000
0,4374
1,0000
0,5869
ACTITUD
DEPEND
FACUSO
INTCOMP
UTIPER
ACTITUD
1,0000
0,5224
0,4246
0,4981
0,6315
DEPEND
FACUSO INTCOMP
UTIPER
1,0000
0,4446
0,4096
0,6145
1,0000
0,4597
0,4900
1,0000
1,0000
0,5168
As a matter of example, for the two critical factors (higher correlation):

2
!utiper
= 0.63152 = 0.3988
" actitud
AVEutiper = 0.5869 > 0.3988

AVEactitud = 0.4425 > 0.3988
39

Evaluating the structural model

Explained variance of the dependent LV (R squared)
Based on each regression R2
R2 are interpreted as in any multiple regression: the amount of variance of the
dependent LV explained by the set of independent LV
R2 should never be < 0.1 (Falk & Miller, 1992)
SmartPLS provides R2 both in the output and in the charts
My opinion: Falk & Miller (1992) is an arbitrary criterion, power analysis
should be added
ACTITUD
DEPEND
FACUSO
INTCOMP
UTIPER

0,4425
0,8823 0,4375
0,8518
0,4047
0,4374
0,8148
0,7616
1,0000
1,0000 0,3210
1,0000
0,5869
0,8938 0,2401
0,8557
Communality
0,4425
0,3595
0,4374
1,0000
0,5869
Redundancy
0,0708
0,0412
0,1940
0,1402
40

R2
41


R2 size must be complemented (if not substituted) by Stone (1974) & Geisser
(1975) resampling proposal.
Blindfolding, implies deleting one part of the data of a dependent LV and
estimating them again using the structural part of the model. This process
repeats until each data point has been deleted and estimated.
Omission distance D has to be decided. It indicates the percentage of data
that are going to be deleted in each step. It must not be a perfect divisor of
the sample size. Wold (1982) recommends numbers between 5 and 10.
Let us assume that case n of variable k has been omitted. We can estimate it
by regressing that variable on the rest of the LV attending the model
structure. But as we know its true value, we can calculate the difference.
Adding those differences for all the omitted data for variable k we get:
Ek = " ykn ! y kn
n=1
42


Now let us assume that, instead of estimating it by using the structural part of
the model, we estimate it ignoring the model by using variable k mean. Once
again we can calculate de difference and repeating it for all the omitted items:
N
Ok = " ykn ! ykn

n=1
Q2 statistic for each dependent LV can be calculated as follow:
Qk2 = 1 !
Ek
Ok
Q2 is a measure of how well the observed values can be replicated using the
estimated parameters:
Q2>0 implies the model has predictive relevance regarding variable k
Q2<0 implies the model lacks of predictive relevance regarding variable k
43


SmartPLS directly provides Q2 values for all the dependent LV
Total
ACTITUD
DEPEND
INTCOMP
UTIPER
SSO
4650,0000
2790,0000
465,0000
2790,0000
SSE
3805,8981
2414,2583
326,3057
2414,4798
1-SSE/SSO
0,1815
0,1347
0,2983
0,1346
44


Analysing the significance of structural paths (bootstrapping)
Evaluating the measurement model
Convergent validity: testing the significance of loadings (bootstrapping)
Bootstrapping
It is a resampling procedure through which N random samples are generated
from the original sample with replacement.
Average values of the parameters estimated in each sample are calculated
and compared to the parameters obtained in the original sample.
Big differences lead to no significant parameters.
Number of subsamples N must be high (around N=500)
Each subsample must have the same sample size that the original sample.
45

Bootstrapping
One
ofdethe
subsamples
Una
la N N
submuestras
Muestra original
Original
sample
20 20 20 20 20 20 20
20
20 20 20 20 20 20 20
4
20
46

Bootstrapping
DEP1 -> DEPEND
DEP2 -> DEPEND
DEP3 -> DEPEND
DEP4 -> DEPEND
DEP5 -> DEPEND
DEP6 -> DEPEND
p.03.01 <- UTIPER
p.03.02 <- UTIPER
p.03.03 <- UTIPER
p.03.04 <- UTIPER
p.03.05 <- UTIPER
p.03.06 <- UTIPER
p.03.07 <- FACUSO
p.03.08 <- FACUSO
p.03.09 <- FACUSO
p.03.10 <- FACUSO
p.03.11 <- FACUSO
p.03.12 <- FACUSO
p.04.01 <- ACTITUD
p.04.02 <- ACTITUD
p.04.03 <- ACTITUD
p.04.04 <- ACTITUD
p.04.05 <- ACTITUD
p.04.06 <- ACTITUD
p.04.07 <- ACTITUD
p.04.08 <- ACTITUD
p.04.09 <- ACTITUD
p.04.10 <- ACTITUD
p.05 <- INTCOMP
Original Sample
Standard T
Sample
Mean
Error
Statistics
0,5274
0,5192
0,0727
7,2547
0,3278
0,3213
0,0762
4,3029
0,43
0,423
0,0777
5,5345
0,925
0,9149
0,0266 34,7133
0,6135
0,6033
0,0673
9,121
0,5955
0,5856
0,0616
9,6686
0,5714
0,5668
0,0449 12,7149
0,7917
0,7911
0,0205 38,5845
0,8203
0,8193
0,019 43,2043
0,8098
0,8079
0,0209 38,8366
0,7766
0,7727
0,0256 30,3694
0,7976
0,7945
0,0223 35,7663
0,8198
0,8163
0,0204 40,2304
0,4614
0,4544
0,0808
5,7132
0,6897
0,685
0,0432 15,9552
0,7444
0,7425
0,03 24,8401
0,3946
0,3861
0,0907
4,3502
0,7441
0,7426
0,0286 25,9782
0,606
0,6014
0,0447 13,5555
0,6617
0,6619
0,0389 17,0137
0,2838
0,2813
0,0739
3,8391
0,7607
0,7576
0,0289 26,3512
0,833
0,8304
0,017 49,0118
0,8042
0,8032
0,0205 39,2634
0,757
0,7543
0,0299 25,2988
0,5889
0,5857
0,0417 14,1064
0,4969
0,4916
0,0464 10,7014
0,6737
0,6717
0,0384 17,5488
1
1
0
0
Outer loadings
47

Bootstrapping
DEP1 -> DEPEND

DEP2 -> DEPEND
DEP3 -> DEPEND
DEP4 -> DEPEND
DEP5 -> DEPEND
DEP6 -> DEPEND
p.03.01 <- UTIPER
p.03.02 <- UTIPER
p.03.03 <- UTIPER
p.03.04 <- UTIPER
p.03.05 <- UTIPER
p.03.06 <- UTIPER
p.03.07 <- FACUSO
p.03.08 <- FACUSO
p.03.09 <- FACUSO
p.03.10 <- FACUSO
p.03.11 <- FACUSO
p.03.12 <- FACUSO
p.04.01 <- ACTITUD
p.04.02 <- ACTITUD
p.04.03 <- ACTITUD
p.04.04 <- ACTITUD
p.04.05 <- ACTITUD
p.04.06 <- ACTITUD
p.04.07 <- ACTITUD
p.04.08 <- ACTITUD
p.04.09 <- ACTITUD
p.04.10 <- ACTITUD
p.05 <- INTCOMP
Original Sample
Standard T
Sample
Mean
Error
Statistics
0,5274
0,5192
0,0727
7,2547
0,3278
0,3213
0,0762
4,3029
0,43
0,423
0,0777
5,5345
0,925
0,9149
0,0266 34,7133
0,6135
0,6033
0,0673
9,121
0,5955
0,5856
0,0616
9,6686
0,5714
0,5668
0,0449 12,7149
0,7917
0,7911
0,0205 38,5845
0,8203
0,8193
0,019 43,2043
0,8098
0,8079
0,0209 38,8366
0,7766
0,7727
0,0256 30,3694
0,7976
0,7945
0,0223 35,7663
0,8198
0,8163
0,0204 40,2304
0,4614
0,4544
0,0808
5,7132
0,6897
0,685
0,0432 15,9552
0,7444
0,7425
0,03 24,8401
0,3946
0,3861
0,0907
4,3502
0,7441
0,7426
0,0286 25,9782
0,606
0,6014
0,0447 13,5555
0,6617
0,6619
0,0389 17,0137
0,2838
0,2813
0,0739
3,8391
0,7607
0,7576
0,0289 26,3512
0,833
0,8304
0,017 49,0118
0,8042
0,8032
0,0205 39,2634
0,757
0,7543
0,0299 25,2988
0,5889
0,5857
0,0417 14,1064
0,4969
0,4916
0,0464 10,7014
0,6737
0,6717
0,0384 17,5488
1
1
0
0
Outer weights
48

Bootstrapping
Path coefficients
ACTITUD -> INTCOMP

DEPEND -> ACTITUD
DEPEND -> INTCOMP
FACUSO -> ACTITUD
FACUSO -> DEPEND
FACUSO -> UTIPER
UTIPER -> ACTITUD
UTIPER -> DEPEND
UTIPER -> INTCOMP
Original
Sample
Sample (O)
Mean (M)
0,2655
0,1891
0,0906
0,1159
0,1888
0,49
0,4585
0,522
0,2935
Standard
0,2673
0,1944
0,0968
0,1214
0,1918
0,4961
0,4513
0,5234
0,2834
Error (STERR)
0,0591
0,0502
0,0593
0,0479
0,0524
0,0418
0,0537
0,044
0,0583
T Statistics
(|O/STERR|)
4,4887
3,7677
1,5277
2,4185
3,5989
11,7114
8,5314
11,8668
5,0363
49

Measurement model evaluation

Indicator 1 of usefulness is deleted (loading <.70)
Indicators 2 and 5 of ease of use are deleted (loading <.70)
No reliability problems
Regarding convergent validity some problems arise with AVE, but we wait to
see what happens after deleting de above mentioned items
No problems of discriminant validity
Structural model evaluation
We must not do anything until the measurement model is considered the
definitive one.
Once modified the measurement model, the estimation is performed again
50

51

ACTITUD
DEP1
DEP3
DEP4
DEP5
DEP6
p.03.02
p.03.03
p.03.04
p.03.05
p.03.06
p.03.07
p.03.09
p.03.10
p.03.12
p.04.04
p.04.05
p.04.06
p.04.07
p.04.10
p.05
DEPEND
0,5275
0,4170
0,9233
0,6106
0,5986
FACUSO
INTCOMP
UTIPER
0,7947
0,8339
0,8122
0,7910
0,8119
Convergent validity
Outer loadings
0,8146
0,6910
0,7508
0,7547
0,7914
0,8645
0,8207
0,7614
0,7110
1,0000
52

Reliability: CR, Cronbachs alpha,

AVE
ACTITUD
DEPEND
FACUSO
INTCOMP
UTIPER
AVE
0,6265
Composite Reliability
0,8931
0,5686
1,0000
0,6543
0,8401
1,0000
0,9044
R Square Cronbachs Alpha

0,3874
0,8506
0,4112
0,7480
0,3193
1,0000
0,2512
0,8679
Communality
0,6265
0,4072
0,5686
1,0000
0,6543
Redundancy
0,0834
0,0539
0,1995
0,1633
53

Convergent validity: crossloadings
DEP1
DEP3
DEP4
DEP5
DEP6
p.03.02
p.03.03
p.03.04
p.03.05
p.03.06
p.03.07
p.03.09
p.03.10
p.03.12
p.04.04
p.04.05
p.04.06
p.04.07
p.04.10
p.05
ACTITUD
0,2784
0,2810
0,4289
0,3501
0,3444
0,4843
0,4630
0,4795
0,4553
0,5066
0,3237
0,2492
0,3246
0,3640
0,7914
0,8645
0,8207
0,7614
0,7110
0,4942
DEPEND
0,5275
0,4170
0,9233
0,6106
0,5986
0,5633
0,5155
0,4548
0,4593
0,4981
0,3624
0,2397
0,3599
0,3946
0,3652
0,4226
0,4288
0,3414
0,3564
0,4126
FACUSO
0,2772
0,1448
0,4255
0,2365
0,2264
0,4273
0,4253
0,4537
0,3552
0,3582
0,8146
0,6910
0,7508
0,7547
0,2704
0,4021
0,4080
0,1866
0,3663
0,4566
INTCOMP
0,2490
0,0911
0,3823
0,1844
0,2053
0,4306
0,3886
0,4497
0,3521
0,4032
0,3756
0,3333
0,3577
0,3155
0,3728
0,3995
0,4752
0,3224
0,3572
1,0000
UTIPER
0,2676
0,2670
0,5889
0,3986
0,3724
0,7947
0,8339
0,8122
0,7910
0,8119
0,3733
0,3064
0,3966
0,4182
0,4330
0,5312
0,5901
0,3648
0,3629
0,5023
UTIPER
FACUSO
ACTITUD
54

ACTITUD
DEPEND
FACUSO
INTCOMP
UTIPER
AVE
0,6265
0,8931
0,5686
1,0000
0,6543
0,8401
1,0000
0,9044
ACTITUD
FACUSO
INTCOMP
UTIPER
ACTITUD
1,0000
0,4242
0,4942
0,5911

0,3874
0,8506
0,4112
0,7480
0,3193
1,0000
0,2512
0,8679
FACUSO
INTCOMP
UTIPER
1,0000
0,4566
0,5012
1,0000
0,5023
1,0000
LV
Discriminant validity
AVE vs. correlations
Communality
0,6265
0,4072
0,5686
1,0000
0,6543
Redundancy
0,0834
0,0539
0,1995
0,1633
AVE
ACTITUD
.79
FACUSO
.75
INTCOMP
N/A
UTIPER
.81
55

ACTITUD
DEPEND
FACUSO
INTCOMP
UTIPER
AVE
0,6265
0,8931
0,5686
1,0000
0,6543
0,8401
1,0000
0,9044

0,3874
0,8506
0,4112
0,7480
0,3193
1,0000
0,2512
0,8679
Communality
0,6265
0,4072
0,5686
1,0000
0,6543
Redundancy
0,0834
0,0539
0,1995
0,1633
Structural model
R2
Fuente: Hair, Black, Babin, Anderson y Tatham (2006; p.195)
56

Structural model
Q2, predictive relevance
Total
ACTITUD
DEPEND
INTCOMP
UTIPER
SSO
2325,0000
2325,0000
465,0000
2325,0000
SSE
1799,2618
1947,7690
323,8041
1981,4057
1-SSE/SSO
0,2261
0,1622
0,3036
0,1478
57

Bootstrapping
Outer loadings
58

Bootstrapping
Outer weights
59

Desarrollo de un caso de ejemplo
Bootstrapping
Path coefficients
60

Results in an academic paper

Measurement model: reliability and convergent validity
Factor
Indicator
F1. Usefulness
UTPER2
UTPER3
UTPER4
UTPER5
UTPER6
FACUSO1
FACUSO3
FACUSO4
FACUSO6
DIM1
DIM3
DIM4
DIM5
DIM6
ACT4
ACT5
ACT6
ACT7
ACT10
F2. Ease of use
F3. Internet dependence
F4. Attitude
Loading
Weight
0,795***
0,834***
0,812***
0,791***
0,812***
0,815***
0,691***
0,751***
0,755***
0,286***
-0,122*
0,732***
0,168**
0,203**
0,791***
0,864***
0,821***
0,861***
0,711***
t value
42,02
53,33
44,17
31,73
44,49
41,27
17,09
27,26
29,95
4,57
1,64
13,71
1,96
2,47
32,23
62,43
44,86
27,63
20,30
CA
CR
AVE
0,868
0,904
0,654
0,748
0,840
0,569
N/A
N/A
N/A
0,851
0,893
0,627
***p<.01; **p<.05; *p<.10; N/A = Do not apply
61

Measurement model: discriminant validity

F1
F1
F2
F3
F4
F2
.81
0,501
0,618
0,591
F3
.75
0,459
0,424
F4
N/A
0,488
.79
**p<.01; *p<.05; N/A = Do not apply

Below diagonal: correlation among latent variables
Diagonal: square root of AVE
62

Hypotheses testing
Hypothesis
Standardized
beta
H1: Ease of use Usefulness

H2: Ease of use Attitude
H3: Usefulness Attitude
H4: Usefulness Intention to buy
H5: Attitude Intention to buy
H6: Usefulness Internet dependency
H7: Ease of use Internet dependency
H8: Internet dependency Attitude
H9: Internet dependency Intention to buy
0,501**
0,138**
0,419**
0,268**
0,283**
0,518**
0,199**
0,166**
0,110*
t value
Bootstrap
13,38
3,14
8,34
4,49
5,05
13,54
4,04
3,48
2,08
R2 (Usefulness) = 0,251; R2 (Attitude) = 0,387; R2(Dependency) = 0,411; R2 (Intention) = 0,319;

Q2 (Usefulness) = 0,148; Q2 (Attitude) = 0,226; Q2(Dependency) = 0,162; Q2 (Intention) = 0,304;
**p<.01; *p<.05
63
Introduction to Structural Equation Modelling

Partial Least Squares Path Modeling

(PLSPM)
Exercise
Joaqun Alds Manzano

Universitat de Valncia
* joaquin.aldas@uv.es
64

Determinants and consequences of client satisfaction
Fornell, Johnson, Anderson, Cha y Bryant (1996)
Model
Read paper from Fornell, Johnson, Anderson, Cha & Bryant (1996)
65

Questions
Use data file ecsi.csv
Draw model of next figure
Evaluate if sample size is big enough to apply PLSPM
Evaluate measurement model reliability and validity and estimate
parameters significance using bootstrapping
Evaluate the structural model
Create a table to publish the results in an academic paper
66

67

4e PLSPM

Încărcat de

Informații document

Descriere originală:

Titlu original

Drepturi de autor

Formate disponibile

Partajați acest document

Partajați sau inserați document

Opțiuni de partajare

Vi se pare util acest document?

Este necorespunzător acest conținut?

Drepturi de autor:

Formate disponibile

4e PLSPM

Încărcat de

Drepturi de autor:

Formate disponibile

Introduction to Structural Equation Modelling

Partial Least Squares Path Modelling

Partial Least Squares (PLS)

In 1960 Karl Jreskog proposed an algorithm to estimate covariance based

Partial Least Squares

Partial Least Squares

0.33 0.26 = 0.085 ; 0.087 = X1 X 2

0.33 0.83 0.46 = 0.126 ; 0.140 = X1 X 3

Partial Least Squares

Partial Least Squares

Partial Least Squares

Manifest variables or indicators of

Manifest variables or indicators of

Partial Least Squares

Partial Least Squares

Inner weights estimation

Outer weights estimation

Partial Least Squares

!1outer = x11 + x12

w11 = w12 = w21 = w31 = w32 = w33 = 1

Partial Least Squares

Inner weights estimation

" cov(! outer , ! outer ) ! ,! adjacent

Partial Least Squares

!iinner = " eij! outer

Partial Least Squares

Outer weights estimation

Partial Least Squares

Outer weights estimation

$&!1inner = c1 + w11 x11 + w12 x12 + #1

Partial Least Squares

1outer = w11 x11 + w12 x12

Partial Least Squares

Partial Least Squares

Latent variable scores

Partial Least Squares

Structural part of the model must be recursive

(*) SmartPLS restrictions, not necessarily PLSPM restrictions

Partial Least Squares

Small although representative sample sizes (to be clarified)

Partial Least Squares

Higher number or LV that point to a dependent

Number of indicators of the most complex

Partial Least Squares

Partial Least Squares

Use a good power analysis software like G*Power

Partial Least Squares

Partial Least Squares

Partial Least Squares

Partial Least Squares

Draw the model

Partial Least Squares

Run the model

Partial Least Squares

Validating the measurement model

Reliability (Cronbachs alpha)

Where Lij is the standardized loading of item j on factor i

Var Eij = 1 ! Lij2

Partial Least Squares

Validating the measurement model

(0.5714 + 0.7917 + 0.8203 + 0.8098 + 0.7766 + 0.7976)

+ (1! 0.8098) 2 + (1! 0.7766) 2 + (1! 0.7976) 2