Potential model misspecification bias: Formative indicators enhancing theory for accounting researchers

Waymond Rodgers; Andrés Guiral

doi:10.1016/j.intacc.2010.12.002

Potential model misspecification bias: Formative indicators enhancing theory for accounting researchers

Waymond Rodgers, Andrés Guiral

Department of Business Administration

Research output: Contribution to journal › Article › peer-review

21 Citations (Scopus)

Abstract

This paper describes why and when formative factors, in combination with reflective measures, can be used in accounting research to better represent complex theoretical constructs. We argue that the exclusive use of reflective factors constrains theory development and may lead to imprecise measurement. We provide a review of 66 published research papers from Accounting, Organization and Society, The Accounting Review, Contemporary Accounting Research, Auditing: A Journal of Practice & Theory, Accounting, Auditing, & Accountability Journal, Behavioral Research in Accounting, International Journal of Accounting, Journal of Accounting and Public Policy, Management Accounting Research, Abacus, and Journal of Management Accounting Research using Structural Equation Models (SEM) from 1992 to 2008 to illustrate improvement of misspecification bias in leading accounting journals. Our findings suggest that most of the studies modeled constructs that did not include formative indicators.

Original language	English
Pages (from-to)	25-50
Number of pages	26
Journal	International Journal of Accounting
Volume	46
Issue number	1
DOIs	https://doi.org/10.1016/j.intacc.2010.12.002
Publication status	Published - 2011 Mar

Bibliographical note

Funding Information:
We appreciate the helpful comments from two anonymous reviewers, and participants at the 30th Annual Congress of the European Accounting Association, Lisbon. The authors gratefully acknowledge funding received from the Centro Internacional de Formación Financiera (CIFF) Foundation, the Spanish National R+D+I Plan through the research projects SEJ2007-62215/ECON, SEJ2004-00791ECON, SEJ 2006-14021, and the postdoctoral/Fulbright grant EX2004-0294.

All Science Journal Classification (ASJC) codes

Accounting
Finance

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10.1016/j.intacc.2010.12.002

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abstract = "This paper describes why and when formative factors, in combination with reflective measures, can be used in accounting research to better represent complex theoretical constructs. We argue that the exclusive use of reflective factors constrains theory development and may lead to imprecise measurement. We provide a review of 66 published research papers from Accounting, Organization and Society, The Accounting Review, Contemporary Accounting Research, Auditing: A Journal of Practice & Theory, Accounting, Auditing, & Accountability Journal, Behavioral Research in Accounting, International Journal of Accounting, Journal of Accounting and Public Policy, Management Accounting Research, Abacus, and Journal of Management Accounting Research using Structural Equation Models (SEM) from 1992 to 2008 to illustrate improvement of misspecification bias in leading accounting journals. Our findings suggest that most of the studies modeled constructs that did not include formative indicators.",

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note = "Funding Information: We appreciate the helpful comments from two anonymous reviewers, and participants at the 30th Annual Congress of the European Accounting Association, Lisbon. The authors gratefully acknowledge funding received from the Centro Internacional de Formaci{\'o}n Financiera (CIFF) Foundation, the Spanish National R+D+I Plan through the research projects SEJ2007-62215/ECON, SEJ2004-00791ECON, SEJ 2006-14021, and the postdoctoral/Fulbright grant EX2004-0294. ",

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Potential model misspecification bias: Formative indicators enhancing theory for accounting researchers

Abstract

Bibliographical note

All Science Journal Classification (ASJC) codes

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