Hi,
I know that statistically speaking these two effects can be estimated and interpreted in the same way. Most of the time, scholars tend to use them interchangeably in their papers and projects. Still, I am wondering if there is a conceptual difference between a moderating and a interacting variable. If yes, can you provide any examples?
In advance, thank you for your help.
Best,
Lukasz
INTERACTION EFFECT: This is the general term used to describe the interaction of a 3rd variable with the IV to produce the relationship between X and Y. The interaction may be in a form of moderation or mediation.
MODERATION: In a proposed model of, say, Y = a + b1X1 + b2X2 with the introduction of moderator then the model become Y = a + b1X1 + b2X2 + b3(X1X2). There is no inclusion of the third variable, but the interaction is between X1 and X2 which points to the idea that there might be a third variable that need to be identified or classified from the combination of X1 and X2.
MEDIATION: This is a case of a missing variable in the proposed predictive model of Y = a + bX, there is a missing variable Z which interacts with X to produce Y where in the proposed model of Y = a + bX the relationship may not reach significance level, but when introduce Z then the value of Y changes. There is an inclusion of a third variable Z, thus: Y = a + bX + Z
LINKS:
https://en.wikipedia.org/wiki/Moderation_(statistics)
https://en.wikipedia.org/wiki/Mediation_(statistics)
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