An Alternative Approach to Method Effects by Using Latent-Variable Models: Applications in Organizational Behavior Research

Recent research in the area of organizational behavior on social desirability and negative affectivity as potential sources of artifactual covariance is reviewed. Next, an example of a latent-variable structural equation approach is presented as a more appropriate strategy for analyzing method effects that circumvents problems associated with prior statistical techniques. This example illustrates the specification of a structural equation model with and without method effects and describes the sequence of model comparisons that provides direct tests for the presence of method effects and for the impact of these effects on estimates of substantive relationships. Finally, this latent-variable approach is discussed with regard to other potential applications involving method effects.