A Monte Carlo study comparing PIV,ULS and DWLS in the estimation of dichotomous confirmatory factor analysis

We conducted a Monte Carlo study to investigate the performance of the polychoric instrumental variable estimator (PIV) in comparison to unweighted least squares (ULS) and diagonally weighted least squares (DWLS) in the estimation of a confirmatory factor analysis model with dichotomous indicators. The simulation involved 144 conditions (1,000 replications per condition) that were defined by a combination of (a) two types of latent factor models, (b) four sample sizes (100, 250, 500, 1,000), (c) three factor loadings (low, moderate, strong), (d) three levels of non‐normality (normal, moderately, and extremely non‐normal), and (e) whether the factor model was correctly specified or misspecified. The results showed that when the model was correctly specified, PIV produced estimates that were as accurate as ULS and DWLS. Furthermore, the simulation showed that PIV was more robust to structural misspecifications than ULS and DWLS.     

EM algorithms for ML factor analysis

The details of EM algorithms for maximum likelihood factor analysis are presented for both the exploratory and confirmatory models. The algorithm is essentially the same for both cases and involves only simple least squares regression operations; the largest matrix inversion required is for aq ×q symmetric matrix whereq is the matrix of factors. The example that is used demonstrates that the likelihood for the factor analysis model may have multiple modes that are not simply rotations of each other; such behavior should concern users of maximum likelihood factor analysis and certainly should cast doubt on the general utility of second derivatives of the log likelihood as measures of precision of estimation.     

On Nonequivalence of Several Procedures of Structural Equation Modeling

The normal theory based maximum likelihood procedure is widely used in structural equation modeling. Three alternatives are: the normal theory based generalized least squares, the normal theory based iteratively reweighted least squares, and the asymptotically distribution-free procedure. When data are normally distributed and the model structure is correctly specified, the four procedures are asymptotically equivalent. However, this equivalence is often used when models are not correctly specified. This short paper clarifies conditions under which these procedures are not asymptotically equivalent. Analytical results indicate that, when a model is not correct, two factors contribute to the nonequivalence of the different procedures. One is that the estimated covariance matrices by different procedures are different, the other is that they use different scales to measure the distance between the sample covariance matrix and the estimated covariance matrix. The results are illustrated using real as well as simulated data. Implication of the results to model fit indices is also discussed using the comparative fit index as an example. The work described in this paper was supported by a grant from the Research Grants Council of Hong Kong Special Administrative Region (Project No. CUHK 4170/99M) and by NSF grant DMS04-37167.     

Estimation and tests of significance in factor analysis

A distinction is drawn between the method of principal components developed by Hotelling and the common factor analysis discussed in psychological literature both from the point of view of stochastic models involved and problems of statistical inference. The appropriate statistical techniques are briefly reviewed in the first case and detailed in the second. A new method of analysis called the canonical factor analysis, explaining the correlations between rather than the variances of the measurements, is developed. This analysis furnishes one out of a number of possible solutions to the maximum likelihood equations of Lawley. It admits an iterative procedure for estimating the factor loadings and also for constructing the likelihood criterion useful in testing a specified hypothesis on the number of factors and in determining a lower confidence limit to the number of factors.     

Comparison of alternative estimation methods in confirmatory factor analyses of the General Health Questionnaire

This paper examines the implications of violating assumptions concerning the continuity and distributional properties of data in establishing measurement models in social science research. The General Health Questionnaire-12 uses an ordinal response scale. Responses to the GHQ-12 from 201 Hong Kong immigrants on arrival in Australia showed that the data were not normally distributed. A series of confirmatory factor analyses using either a Pearson product-moment or a polychoric correlation input matrix and employing either maximum likelihood, weighted least squares or diagonally weighted least squares estimation methods were conducted on the data. The parameter estimates and goodness-of-fit statistics provided support for using polychoric correlations and diagonally weighted least squares estimation when analyzing ordinal, nonnormal data.     

Pairwise Likelihood Ratio Tests and Model Selection Criteria for Structural Equation Models with Ordinal Variables

Correlated multivariate ordinal data can be analysed with structural equation models. Parameter estimation has been tackled in the literature using limited-information methods including three-stage least squares and pseudo-likelihood estimation methods such as pairwise maximum likelihood estimation. In this paper, two likelihood ratio test statistics and their asymptotic distributions are derived for testing overall goodness-of-fit and nested models, respectively, under the estimation framework of pairwise maximum likelihood estimation. Simulation results show a satisfactory performance of type I error and power for the proposed test statistics and also suggest that the performance of the proposed test statistics is similar to that of the test statistics derived under the three-stage diagonally weighted and unweighted least squares. Furthermore, the corresponding, under the pairwise framework, model selection criteria, AIC and BIC, show satisfactory results in selecting the right model in our simulation examples. The derivation of the likelihood ratio test statistics and model selection criteria under the pairwise framework together with pairwise estimation provide a flexible framework for fitting and testing structural equation models for ordinal as well as for other types of data. The test statistics derived and the model selection criteria are used on data on ‘trust in the police’ selected from the 2010 European Social Survey. The proposed test statistics and the model selection criteria have been implemented in the R package lavaan.     

The Infinitesimal Jackknife with Exploratory Factor Analysis

The infinitesimal jackknife, a nonparametric method for estimating standard errors, has been used to obtain standard error estimates in covariance structure analysis. In this article, we adapt it for obtaining standard errors for rotated factor loadings and factor correlations in exploratory factor analysis with sample correlation matrices. Both maximum likelihood estimation and ordinary least squares estimation are considered.     

When can categorical variables be treated as continuous? A comparison of robust continuous and categorical SEM estimation methods under suboptimal conditions

A simulation study compared the performance of robust normal theory maximum likelihood (ML) and robust categorical least squares (cat-LS) methodology for estimating confirmatory factor analysis models with ordinal variables. Data were generated from 2 models with 2-7 categories, 4 sample sizes, 2 latent distributions, and 5 patterns of category thresholds. Results revealed that factor loadings and robust standard errors were generally most accurately estimated using cat-LS, especially with fewer than 5 categories; however, factor correlations and model fit were assessed equally well with ML. Cat-LS was found to be more sensitive to sample size and to violations of the assumption of normality of the underlying continuous variables. Normal theory ML was found to be more sensitive to asymmetric category thresholds and was especially biased when estimating large factor loadings. Accordingly, we recommend cat-LS for data sets containing variables with fewer than 5 categories and ML when there are 5 or more categories, sample size is small, and category thresholds are approximately symmetric. With 6-7 categories, results were similar across methods for many conditions; in these cases, either method is acceptable. (PsycINFO Database Record (c) 2012 APA, all rights reserved).     

Factor analysis by instrumental variables methods

Three alternative estimation procedures for factor analysis based on the instrumental variables method are presented. These procedures are justified by the method of least squares. Formulas for asymptotic standard errors of factor loadings are derived. The procedures are empirically compared to the method of maximum likelihood. The conclusion, based on the data used in this study, is that two of the procedures seem to work well.     

A study of algorithms for covariance structure analysis with specific comparisons using factor analysis

Several algorithms for covariance structure analysis are considered in addition to the Fletcher-Powell algorithm. These include the Gauss-Newton, Newton-Raphson, Fisher Scoring, and Fletcher-Reeves algorithms. Two methods of estimation are considered, maximum likelihood and weighted least squares. It is shown that the Gauss-Newton algorithm which in standard form produces weighted least squares estimates can, in iteratively reweighted form, produce maximum likelihood estimates as well. Previously unavailable standard error estimates to be used in conjunction with the Fletcher-Reeves algorithm are derived. Finally all the algorithms are applied to a number of maximum likelihood and weighted least squares factor analysis problems to compare the estimates and the standard errors produced. The algorithms appear to give satisfactory estimates but there are serious discrepancies in the standard errors. Because it is robust to poor starting values, converges rapidly and conveniently produces consistent standard errors for both maximum likelihood and weighted least squares problems, the Gauss-Newton algorithm represents an attractive alternative for at least some covariance structure analyses.Work by the first author has been supported in part by Grant No. Da01070 from the U. S. Public Health Service. Work by the second author has been supported in part by Grant No. MCS 77-02121 from the National Science Foundation.     

Effects of skewness and kurtosis on normal-theory based maximum likelihood test statistic in multilevel structural equation modeling

A simulation study investigated the effects of skewness and kurtosis on level-specific maximum likelihood (ML) test statistics based on normal theory in multilevel structural equation models. The levels of skewness and kurtosis at each level were manipulated in multilevel data, and the effects of skewness and kurtosis on level-specific ML test statistics were examined. When the assumption of multivariate normality was violated, the level-specific ML test statistics were inflated, resulting in Type I error rates that were higher than the nominal level for the correctly specified model. Q-Q plots of the test statistics against a theoretical chi-square distribution showed that skewness led to a thicker upper tail and kurtosis led to a longer upper tail of the observed distribution of the level-specific ML test statistic for the correctly specified model.     

Dynamical system approach to factor analysis parameter estimation

A new unified approach to solving and studying the factor analysis parameter estimation problem is proposed. The maximum likelihood and least squares formulations of factor analysis are considered. The approach leads to globally convergent procedures for simultaneous estimation of the factor analysis parameters. The method presented necessarily leads to proper factor analysis estimations.     

Replies to comments on "Which method delivers greater signal-to-noise ratio: Structural equation modelling or regression analysis with weighted composites?" by Yuan and Fang (2023)

Observational data typically contain measurement errors. Covariance-based structural equation modelling (CB-SEM) is capable of modelling measurement errors and yields consistent parameter estimates. In contrast, methods of regression analysis using weighted composites as well as a partial least squares approach to SEM facilitate the prediction and diagnosis of individuals/participants. But regression analysis with weighted composites has been known to yield attenuated regression coefficients when predictors contain errors. Contrary to the common belief that CB-SEM is the preferred method for the analysis of observational data, this article shows that regression analysis via weighted composites yields parameter estimates with much smaller standard errors, and thus corresponds to greater values of the signal-to-noise ratio (SNR). In particular, the SNR for the regression coefficient via the least squares (LS) method with equally weighted composites is mathematically greater than that by CB-SEM if the items for each factor are parallel, even when the SEM model is correctly specified and estimated by an efficient method. Analytical, numerical and empirical results also show that LS regression using weighted composites performs as well as or better than the normal maximum likelihood method for CB-SEM under many conditions even when the population distribution is multivariate normal. Results also show that the LS regression coefficients become more efficient when considering the sampling errors in the weights of composites than those that are conditional on weights.     

Influence curves for factor loadings

Influence curves for the initial and rotated loadings are derived for the maximum likelihood factor analysis (MLFA) model. Cook's distances based on the empirical influence curves of factor loadings are proposed for the identification of influential observations. The distances are shown to be invariant under scale transformation and factor rotation. We find that an observation with a very large Cook's distance based on the sample influence curve may not necessarily exert an excessive influence on the factor loadings pattern but may change the ordering of the factors. The issue of the switching of factors is also studied by means of the empirical influence curve and factor scores.     

Application of the bootstrap methods in factor analysis

A Monte Carlo experiment is conducted to investigate the performance of the bootstrap methods in normal theory maximum likelihood factor analysis both when the distributional assumption is satisfied and unsatisfied. The parameters and their functions of interest include unrotated loadings, analytically rotated loadings, and unique variances. The results reveal that (a) bootstrap bias estimation performs sometimes poorly for factor loadings and nonstandardized unique variances; (b) bootstrap variance estimation performs well even when the distributional assumption is violated; (c) bootstrap confidence intervals based on the Studentized statistics are recommended; (d) if structural hypothesis about the population covariance matrix is taken into account then the bootstrap distribution of the normal theory likelihood ratio test statistic is close to the corresponding sampling distribution with slightly heavier right tail.This study was carried out in part under the ISM cooperative research program (91-ISM · CRP-85, 92-ISM · CRP-102). The authors would like to thank the editor and three reviewers for their helpful comments and suggestions which improved the quality of this paper considerably.     

A gauss-newton algorithm for exploratory factor analysis

It is shown that the scoring algorithm for maximum likelihood estimation in exploratory factor analysis can be developed in a way that is many times more efficient than a direct development based on information matrices and score vectors. The algorithm offers a simple alternative to current algorithms and when used in one-step mode provides the simplest and fastest method presently available for moving from consistent to efficient estimates. Perhaps of greater importance is its potential for extension to the confirmatory model. The algorithm is developed as a Gauss-Newton algorithm to facilitate its application to generalized least squares and to maximum likelihood estimation.This research was supported by NSF Grant MCS-8301587.     

Testing and modelling non‐normality within the one‐factor model

Maximum likelihood estimation in the one‐factor model is based on the assumption of multivariate normality for the observed data. This general distributional assumption implies three specific assumptions for the parameters in the one‐factor model: the common factor has a normal distribution; the residuals are homoscedastic; and the factor loadings do not vary across the common factor scale. When any of these assumptions is violated, non‐normality arises in the observed data. In this paper, a model is presented based on marginal maximum likelihood to enable explicit tests of these assumptions. In addition, the model is suitable to incorporate the detected violations, to enable statistical modelling of these effects. Two simulation studies are reported in which the viability of the model is investigated. Finally, the model is applied to IQ data to demonstrate its practical utility as a means to investigate ability differentiation.     

Validation of the Chinese version of the Life Orientation Test with a robust weighted least squares approach

Of the several measures of optimism presently available in the literature, the Life Orientation Test (LOT; Scheier & Carver, 1985) has been the most widely used in empirical research. This article explores, confirms, and cross-validates the factor structure of the Chinese version of the LOT with ordinal data by using robust weighted least squares (robust WLS) estimation within the Taiwanese cultural context. Results of exploratory and confirmatory factor analyses using 3 different samples (Ntotal = 1,119) show that the factor structure of the Chinese version of the LOT is better conceptualized as a correlated 2-factor model than a single-factor model. The composite reliability was 0.7 for the "disagreement on optimism" factor and 0.74 for the "agreement on optimism" factor. In addition, comparison results of the 2 estimators using empirical data and simulation data suggest that robust WLS is less biased than maximum likelihood (ML) for estimating factor loadings and interfactor correlations in the factor analytic model of the Chinese version of the LOT. (PsycINFO Database Record (c) 2012 APA, all rights reserved).     

Estimation for structural equation models with missing data

A direct method in handling incomplete data in general covariance structural models is investigated. Asymptotic statistical properties of the generalized least squares method are developed. It is shown that this approach has very close relationships with the maximum likelihood approach. Iterative procedures for obtaining the generalized least squares estimates, the maximum likelihood estimates, as well as their standard error estimates are derived. Computer programs for the confirmatory factor analysis model are implemented. A longitudinal type data set is used as an example to illustrate the results.This research was supported in part by Research Grant DAD1070 from the U.S. Public Health Service. The author is indebted to anonymous reviewers for some very valuable suggestions. Computer funding is provided by the Computer Services Centre, The Chinese University of Hong Kong.