PLS graph is an application that consists of a windows based graphical user interface that helps the researcher or the user to perform partial least square (PLS) analyses. PLS analysis provides a general model which helps in predictive analyses (usually in pilot studies), such as canonical correlations, multiple regressions, MANOVAs, and PCAs. It helps the user or the researcher in processing the command file in order to obtain an output file which contains the outcomes of the analysis as specified by the command file. It also helps the user or the researcher in viewing the outcomes in the form of a scrollable window. Analytical models can be drawn and the output can be immediately placed back into the model drawing.
PLS helps with theory confirmation and provides suggestions as to where relationships may or may not exist.
In PLS graph, there is a two button mouse metaphor. With the help of that button, the user or the researcher can easily interpret a theoretical model which is represented graphically. This graphical representation of the model by PLS graph is consistent with the partial least squares method of structural equations modeling with a latent variable.
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Assumptions:
All measured variance is useful and can be accounted for within the model.
Latent variables are linear combinations of the observed variables.
Smaller sample sizes are acceptable.
Using the software:
References:
Anderson, J.C. and Gerbing, D.W. (1988). “Structural Equation Modeling in Practice: A Review and Recommended Two-Step Approach,” Psychological Bulletin, 103(3), 411-423.
Chin, W. W. (1998). The partial least squares approach for structural equation modelling. In George A. Marcoulides (Ed.), Modern Methods for Business Research, Lawrence Erlbaum Associates
Chin, W. W., and Newsted, P. R. (1999). Structural Equation Modeling analysis with Small Samples Using Partial Least Squares. In Rick Hoyle (Ed.), Statistical Strategies for Small Sample Research, Sage Publications
Efron, B. and Gong, G. (1983). “A Leisurely Look at the Bootstrap, the Jackknife, and Cross-Validation” The American Statistician, 37(1), 36-48.
Fornell, C., and Bookstein, F. (1982). “Two Structural Equation Models: LISREL and PLS Applied to Consumer Exit-Voice Theory,” Journal of Marketing Research, 19, 440-452.
Fornell, C., Lorange, P., and Roos, J. (1990). “The Cooperative Venture Formation Process: A Latent Variable Structural Modeling Approach,” Management Science, 36(10), 1246-1255.
Jöreskog, K.G. and Wold, H. (1982). “The ML and PLS Techniques For Modeling with Latent Variables: Historical and Comparative Aspects,” in H. Wold and K. Jöreskog (Eds.), Systems Under Indirect Observation: Causality, Structure, Prediction (Vol. I), Amsterdam: North-Holland, 263-270.
Lohmöller, J.-B. (1984). LVPLS Program Manual: Latent Variables Path Analysis with Partial Least-Squares Estimation, Köln: Zentralarchiv für empirische Sozialforschung.
Tabachnick, B.G. and Fidell, L.S. (1989). Using Multivariate Statistics, Second Edition, New York: Harper and Row.
Wold, H. (1981). “The Fix-Point Approach to Interdependent Systems: Review and Current Outlook,” in H. Wold (Ed.), The Fix-Point Approach to Interdependent Systems, Amsterdam: North-Holland, 1-35.
Wold, H. (1985). “Partial Least Squares,” in S. Kotz and N. L. Johnson (Eds.), Encyclopedia of Statistical Sciences (Vol. 6), New York: Wiley, 581-591.
Wold, H. (1989). “Introduction to the Second Generation of Multivariate Analysis,” in H. Wold (Ed.), Theoretical Empiricism. New York: Paragon House, vii-xl.
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