Researchers in a variety of disciplines, including Information
Systems, have argued that much of past research may have incorrectly
specified the relationship between latent variables and indicators
as reflective, when an understanding of a construct and its measures
indicates a formative specification would have been warranted.
Coupled with the posited severe biasing effects of construct
misspecification on structural parameters, these two assertions
would lead to concluding that an important portion of our literature
is largely invalid. While we do not delve into the issue of when one
specification should be employed over the other, our work here
contends that construct misspecification, but with a particular
exception, does not lead to severely biased estimates. We argue, and
show through extensive simulations, that a lack of attention to the
metric in which relationships are expressed is responsible for the
current belief in the negative effects of misspecification.
Keywords: Construct specification, formative, reflective,
simulations, standardized coefficients, unstandardized coefficients