Design Effects on Findings in Simulations Comparing Formative and Reflective Measurement Specifications

In a highly-cited paper on formative measurement, Jarvis et al. (2003; henceforth JMP) use simulation results to argue that “misspecification of even one formatively measured construct within a typical structural equation model can have very serious consequences for the theoretical conclusions drawn from that model” (JMP, p. 212). Aguirre-Urreta and Marakas (2012; henceforth AUM) extend JMP’s simulations to focus on differences in the standardized structural coefficients between the formative and reflective specifications. They conclude “that a lack of attention to the metric of latent variables is responsible for the posited bias [from reflective analyses of formative measures], and when considering the relationships in their standardized form neither the direction nor the magnitude of relationships are biased to the degree previously discussed” (AUM, p. 124). They further note that “the consequences [of alternative measurement specifications] might not be as bleak and dire as previously thought” (AUM, p. 137). Jarvis et al. (2012, p. 144) respond “that the consequences of measurement model misspecification are exactly as dire as previously thought. Those consequences simply never had anything to do with the standardized parameter estimates.”