Why Structural Equation Modeling (SEM)?


In my previous post, I have discussed What is Structural Equation Modeling (SEM)?. In this post Let’s see why would a researcher want to use SEM? SEM has a number of attractive advantages:

  • Assumptions underlying the statistical analyses are clear and testable, giving the investigator full control and potentially furthering understanding of the analyses.
  • Graphical interface software boosts creativity and facilitates rapid model debugging (a feature limited to selected SEM software packages).
  • SEM programs provide overall tests of model fit and individual parameter estimate tests simultaneously.
  • Regression coefficients, means, and variances may be compared simultaneously, even across multiple between-subjects groups.
  • Measurement and confirmatory factor analysis models can be used to purge errors, making estimated relationships among latent variables less contaminated by measurement error.
  • Ability to fit non-standard models, including flexible handling of longitudinal data, databases with autocorrelated error structures (time series analysis), and databases with non-normally distributed variables and incomplete data.
  • This last feature of SEM is its most attractive quality. SEM provides a unifying framework under which numerous linear models may be fit using flexible, powerful software.

Let us know in the comment section below, why you prefer SEM?

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Author and Assistant Professor in Finance, Ardent fan of Arsenal FC. Always believe "The only good is knowledge and the only evil is ignorance - Socrates"
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