A new criterion for assessing discriminant validity in variance-based structural equation modeling

Henseler, Jörg; Ringle, Christian M. und Sarstedt, Marko (2015): A new criterion for assessing discriminant validity in variance-based structural equation modeling. In: Journal of the Academy of Marketing Science, Vol. 43, No. 1: pp. 115-135

Abstract

Discriminant validity assessment has become a generally accepted prerequisite for analyzing relationships between latent variables. For variance-based structural equation modeling, such as partial least squares, the Fornell-Larcker criterion and the examination of cross-loadings are the dominant approaches for evaluating discriminant validity. By means of a simulation study, we show that these approaches do not reliably detect the lack of discriminant validity in common research situations. We therefore propose an alternative approach, based on the multitrait-multimethod matrix, to assess discriminant validity: the heterotrait-monotrait ratio of correlations. We demonstrate its superior performance by means of a Monte Carlo simulation study, in which we compare the new approach to the Fornell-Larcker criterion and the assessment of (partial) cross-loadings. Finally, we provide guidelines on how to handle discriminant validity issues in variance-based structural equation modeling.

• Item Type: Journal article
• Keywords: Discriminant validity assessment, variance-based structural equation modeling, partial least squares, multitrait-multimethod matrix, heterotrait-monotrait ratio of correlations, Monte Carlo simulation study, Fornell-Larcker criterion
• Faculties: Munich School of Management > Institute for Marketing
• Subjects: 300 Social sciences > 330 Economics
• ISSN: 0092-0703
• Language: English