In AMOS (Analysis of Moment Structures), a variable is represented by a rectangle in the path diagram, but it is not considered an observed variable if it is not directly measured or observed in the data collection process. Instead, it is considered an latent variable, also known as a construct, which is inferred from the relationships between other observed variables. This is because latent variables are not directly observable, they are inferred from the relationship between other variables. For example, in a path diagram, a latent variable may be represented by multiple rectangles representing observed variables, with arrows connecting them to indicate how they are related to each other.
Latent variables are widely used in Structural Equation Modeling (SEM) and in particular in path analysis, to represent underlying constructs that are believed to be related to a set of observed variables. In SEM, latent variables are not directly observable and are inferred from the relationships between other variables. In AMOS, latent variables are represented in the path diagram by rectangles with no measurement model.
It is important to note that the distinction between observed and latent variables is not always clear-cut, as some variables may be considered both observed and latent depending on the context and research question.