Hi Ioannis,

in principle, this is possible albeit not easy as both components have to be identifieds. For this purpose, you need instrumental variables for each predictor, see

Wong, C.-S., & Law, K. S. (1999). Testing reciprocal relations by nonrecursive structural equation models using cross-sectional data. Organizational Research Methods, 2(1), 69-78.

Weber, P., Steinmetz, H., & Kabst, R. (2017). Trust in politicians and satisfaction with government–a reciprocal causation approach for european countries. Journal of Civil Society, 13(4), 392-405.

Frone, M. R., Russell, M., & Cooper, M. L. (1994). Relationship between job and family satisfaction: Causal or noncausal covariation? Journal of Management, 20(3), 565-579.

Paxton, P. M., Hipp, J. R., & Marquart-Pyatt, S. (2011). Nonrecursive models. Endogeneity, reciprocal relationships, and feedback loops. Thousand Oaks: Sage.

HTH

Holger

Hi!! Thank you very much for your swift reply!!! I am grateful!

Hi Ioannis,

Have a look at the following chapter as well:

Kline, R.B., 2013, Reverse arrow dynamics. Feedback loops and formative measurement. In Hancock & Mueller, 2013, Structural equation modeling: A second course, (2nd ed.), pp. 41-79.

Good luck!

Best,

Lukasz

Thanks a lot Mr. Derdowski