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DETERMINATION OF VALIDITY AND RELIABILITY OF SCALE: AN APPLICATION

OF CONFIRMATORY FACTOR ANALYSIS USING AMOS

Presentation · November 2016

DOI: 10.13140/RG.2.2.29843.07201

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Vipul V. Patel
Victoria University (Australia), Ahmedabad, India
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 DETERMINATION OF VALIDITY AND RELIABILITY OF SCALE:
AN APPLICATION OF CONFIRMATORY FACTOR ANALYSIS Latent v/s Observed Variables
USING AMOS

 Researchers are often interested in studying

abstract concepts that cannot be measured directly.
 For examples: motivation, satisfaction, loyalty,
attitude, service quality, etc…
 These abstract phenomena are termed latent
variables, or factors.
 Measurable indicators of the latent variable need
to be selected. These measurable indicators are
termed observed or manifest variable.
Dr. Vipul Patel

Scale Development Process Phase I: Theoretical Importance

 Phase I : Theoretical Importance  Content, Domain Specification
 Phase II: Representativeness and  Item Pool Generation
Appropriateness of Data Collection  Content (face) Validity
 Phase III: Statistical Analysis Evaluation

Phase II: Representativeness and

Appropriateness of Data Collection
Phase III: Statistical Analysis
 Questionnaire Development and Evaluation  Dimensionality Assessment
 Translation and Back-translation  Reliability Assessment
 Pilot Study  Construct Validity Assessment
 Sampling and Data Collection

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 Dimensionality Assessment Brand Personality Scale
 Single dimensional or multi-dimensional?  A researcher is interested to develop the scale for brand
personality. At the initial stage, 309 personality traits
 Dimensionality can be assessed using factor
were identified. These were reduced to 114 personality
analysis. traits for study.
 Using exploratory factor analysis, five dimensions with 15
traits of brand personality were identified.
 Sincerity (4), Excitement (4), Competence (3), Sophistication
(2), Ruggedness (2)
 Further, the researcher used CFA to check validity and
reliability of Brand personality scale.

Source: Aaker, J.L. (1997), “Dimensions of Brand Personality,” Journal of Marketing Research, Vol. 34 (3), pp.347-
356.

SERVQUAL Scale EFA v/s CFA

 A researcher is interested to measure perceived service  Exploratory Factor Analysis (EFA):
quality. Ninety seven statements were originally  The researcher may not have any idea as to how many
developed. underlying dimensions there are for the given data.
 These ninety seven statements were reduced to 34 Factor analysis may be used a means of exploring the
statements using factor analysis. These 34 statements data for possible data reduction.
were further reduced to 22 statements, reflecting five  Confirmatory Factor Analysis
dimensions of service quality.
 In CFA, the researcher have prior idea about number of
 Tangibility, reliability, responsiveness, assurance and
factors, the factor structure and the relationship among
empathy.
factors.
 CFA evaluates whether the hypothesized factor model
fits the data or not (Netemeyer et al., 2003).
Source: Parasuraman, A; Zeithaml, V. A and Berry, L.L. (1988), “SERVQUAL: A Multiple-Item Scale For Measuring
Consumer Perceptions of Service Quality,” Journal of Retailing, Vol. 64 (1), pp.12-40.

CFA_Introduction Reliability Assessment of Scale

 Confirmatory factor analysis (CFA) is a statistical  Reliability is the measure of how stable, dependable,
technique used to verify the factor structure of a set of trustworthy, and consistent a test is in measuring the
observed variables. same thing each time (Worthen et al., 1993)
 CFA allows the researcher to test the hypothesis that a  Reliability is a measure of the internal consistency of
relationship between observed variables and their the observed indicator variables. i.e., homogeneity of
underlying latent constructs exists. items within a scale. High inter-item correlations
 The researcher uses knowledge of the theory, empirical suggest that items are measuring the same construct
research, or both, postulates the relationship pattern a (DeVellis, 2003).
priori and then tests the hypothesis statistically.  The most commonly employed internal consistency
 CFA provides quantitative measures that assess the measure is the Cronbach`s (1951) coefficient alpha.
validity and reliability of theoretical model . . .

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Validity Assessment of Scale
 Construct validity…. is the extent to which a set of
measured items actually reflect the theoretical latent
construct they are designed to measure.
 Construct validity is made up of four components:
 Face validity: the extent to which the content of the items is
consistent with the construct definition, based solely on the
researcher’s judgment.
 Convergent validity: the extent to which indicators of a
specific construct “converge” or share a high proportion of
variance in common.
 Discriminant validity: the extent to which a construct is truly
distinct from other constructs (i.e., unidimensional).
 Nomological validity: examines whether the correlations
between the constructs in the measurement theory make
sense.
Convergent Validity
 Convergent validity can be assessed by examining
the factor loadings of the measures on their
respective constructs (Anderson & Gerbing, 1998).
The factor loadings above 0.5, preferably 0.7
indicating convergent validity (Hair et al., 2003)
 Convergent validity is also evaluated through an
examination of the significance of the t-values (also
known as critical ratio). Items which have a t-value
greater than 1.96 can be considered significant
based on the level of p=0.05 (Anderson &
Gerbing, 1988).

Construct Reliability
 Convergent validity can also be determined by  Reliability is also an indicator of convergent validity.
calculating the average variance extracted (AVE)
value of the construct. Hair et al. (2000) suggest this
n The sum of the loadings,
value to be higher than 0.50, indicating that more (i )2 squared
than half the variance of the indicators is explained CR  n
i1
n
by their construct. (i )2  (i )
The sum of the squared i1 i1

n
2
factor loadings 
 i  1  i 2 

i 1
i
AVE 
n

Discriminant Validity Nomological Validity

 Discriminant validity is the extent to which a  Nomological validity . . . is tested by examining
construct is truly distinct from other constructs whether the correlations between the constructs in
(i.e., unidimensional). the measurement model make sense. The construct
 Holmes-Smith (2001) recommended that the correlations are used to assess this.
average AVE of the two constructs must exceed the
square of their correlation to satisfy the Discriminant
Validity test.

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Software Used for CFA
 Lisrel
 SPSS’s AMOS
 EQS
 Mplus
 Mx
 SEM package in R
 SAS PROC CALIS
Sample Size
 Always maximize your sample size
 As a general rule, the minimum sample size is to have at
least 15- 20 times as many observations as the number
of variables to be analyzed.
 CFA models containing five or fewer constructs, each
with more than three items can be adequately
estimated with sample size as small as 100-150.
 If the model contains constructs with fewer than three
items, then minimum sample sizes of 300 or more are
needed.
 When number of factors larger than six, some of which
use fewer than three measured items, sample size
requirements may exceed 500.
 Construct: Stress
 Reflective Measures: blood pressure, perspiration,
nervousness, frigidity, etc. These are caused by
stress, or a reflection of it.
 Formative Measures: difficult boss, troubled home
– kids, spouse, poor work evaluations, debt, medical
condition (cancer, heart problems) job changes, etc.
These actually cause stress instead of stress causing
them.
Basic Assumption for CFA
 Predetermined Research Model: the researcher must
specify the number of factors that exist within a set
of variables and which variables load on those
factors.
 No cross loadings.
 Latent constructs should be indicated by at least
three measured variables, preferably four or more.
 Measured items must be measured on metric type
of scale., i.e, continuous variable…..likert, semantic
deferential, etc.
Reflective v/s Formative Constructs
 Reflective Measurement Theory: assumes the latent
constructs cause the measured indicator variables.
Thus, arrows are drawn from the latent constructs to
the measured indicators.
 Formative Measurement Theory: assumes the
measured indicator variables cause the construct.
formative constructs are not considered latent.
Instead, they are viewed as indices. For example,
Social Class Index.
 Construct: Intoxicated/Drunk
 Reflective measures: unable to walk in straight line
or stumbling, slurred speech, talking loud, laughing,
etc.
 Formative measures: alcohol/drugs combined with
lack of sleep, how much you have eaten, how fast
and how much you drink, etc.
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Symbol Notation of AMOS
 Latent variable represented by a circle
 Measured variables (indicators) represented by a
square
 Each indicator variable has an error term
 Each variable loads on one and only one factor
 Factors can (and typically are) correlated
 One indicator treated as a marker or reference
variable. Its loading is fixed to one.
 Which variable should you choose?
 closest in meaning to the factor
 most interpretable units of measurement
 empirical: strongest correlations with other indicators

 Errors across indicator variables are independent

One Factor CFA Model Two Factor CFA Model

Error Error Error

Var1 Var2 Var3

1 1 1 F1 F2

Observed Observed Observed

Variable 1 Variable 2 Variable 3
1 1

1
V1 V2 V3 V4 V5 V6

1 1 1 1 1
1
Latent
Variable E1 E2 E3 E4 E5 E6

Model Fit Diagnostics

 CMIN/DF – a value below 2 is preferred but
between 2 and 5 is considered acceptable.
 GFI, AGFI, NFI, TLI, IFI, RFI,CFI – Magic 0.9 value Example of CFA: TAM
 RMSEA = Root Mean Squared Error of Approximation
– a value of 0.10 or less is considered acceptable.

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 Thank you!!!

Dr. Vipul Patel

vipulpat@gmail.com

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