Calculating Total Effects Accurately in SEM
Today, 07:02
I would like to make sure that I correctly calculate total effects as well as direct and indirect effects from a path analysis model. I would be grateful if you could help me go in the right direction. The path analysis model I work with is shown below. If it weren’t for the variable SocialMarketEconomy, the total effects running from PovertyRates to GDPgrowth are: a*b + d*e + c. --> (1) What I am not confident about is the total effects running from SocialMarketEconomy to GDPgrowth via PovertyRates. Is it the following?: i*b + f*e + g + h*a*b + h*c + h*d*e --> (2) The first thing I would like to make sure is that I correctly understand the paths from SocialMarketEconomy to GDPgrow. Second, am I correct to think that in the presence of the effects (paths) from SocialMarketEconomy, the first total as well as indirect effects I write up (1) are not correct? I would like to understand this, so any help would be welcome. Thank you in advance for your kind help. Best, Taka
Hello Takayuki,
1. Yes, you have correctly outlined all of the indirect terms and the one direct term for estimating total effect of SME on GDPG.
2. Your results offer evidence that PovRates, Investment, and Consumption partially mediate the influence of SME on GDPG.
Good luck with your work.
Thank you so much, David. It's a big help.
So, it's not a problem to include the same coffiients (e.g., hfcegrow-->gdpgrow and gfcfgrow--> gdpgrow) multiple times in calculating total effects? The answer must be no. But I would like to make sure I understand.
Thank you again for your kind help.
Best,
Taka
Hello again Takayuki,
Yes, when calculating indirect (multiplicative) effects, it's not uncommon for specific coefficients to be re-used.
Good luck with your work.
Thank you, David. You've helped me tremendously.
Many thanks again.
Taka
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