Discriminant validity assessment has become a generally accepted prerequisite for analyzing relationships between latent variables. For variance-based structural equation modeling, such as partial least squares, the Fornell-Larcker criterion and the examination of cross-loadings are the dominant approaches for evaluating discriminant validity. By means of a simulation study, we show that these approaches do not reliably detect the lack of discriminant validity in common research situations. We therefore propose an alternative approach, based on the multitrait-multimethod matrix, to assess discriminant validity: the heterotrait-monotrait ratio of correlations. We demonstrate its superior performance by means of a Monte Carlo simulation study, in which we compare the new approach to the Fornell-Larcker criterion and the assessment of (partial) cross-loadings. Finally, we provide guidelines on how to handle discriminant validity issues in variance-based structural equation modeling.

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A new criterion for assessing discriminant validity in variance-based structural equation modeling

Purpose: This paper discusses partial least squares path modeling (PLS), a powerful structural equation modeling technique for research on international marketing. While a significant body of research provides guidance for the use of covariance-based structural equation modeling (CBSEM) in international marketing, there are no subject-specific guidelines for the use of PLS so far.Methodology/approach: A literature review of the use of PLS in international marketing reveals the increasing application of this methodology.Findings: This paper reveals the strengths and weaknesses of PLS in the context of research on international marketing, and provides guidance for multi-group analysis.Originality/value of paper: The paper assists researchers in making well-grounded decisions regarding the application of PLS in certain research situations and provides specific implications for an appropriate application of the methodology.

The Use of Partial Least Squares Path Modeling in International Marketing

A separate and distinct interaction with both the actual e-vendor and with its IT Web site interface is at the heart of online shopping Previous research has established, accordingly, that online purchase intentions are the product of both consumer assessments of the IT itself-specifically its perceived usefulness and ease-of-use (TAM)-and trust in the e-vendor But these perspectives have been examined independently by IS researchers Integrating these two perspectives and examining the factors that build online trust in an environment that lacks the typical human interaction that often leads to trust in other circumstances advances our understanding of these constructs and their linkages to behavior

Our research on experienced repeat online shoppers shows that consumer trust is as important to online commerce as the widely accepted TAM use-antecedents, perceived usefulness and perceived ease of use Together these variable sets explain a considerable proportion of variance in intended behavior The study also provides evidence that online trust is built through (1) a belief that the vendor has nothing to gain by cheating, (2) a belief that there are safety mechanisms built into the Web site, and (3) by having a typical interface, (4) one that is, moreover, easy to use

Trust and TAM in online shopping: an integrated model

Much previous research has established that perceived ease of use is an important factor influencing user acceptance and usage behavior of information technologies. However, very little research has been conducted to understand how that perception forms and changes over time. The current work presents and tests an anchoring and adjustment-based theoretical model of the determinants of system-specific perceived ease of use. The model proposes control (internal and external--conceptualized as computer self-efficacy and facilitating conditions, respectively), intrinsic motivation (conceptualized as computer playfulness), and emotion (conceptualized as computer anxiety) as anchors that determine early perceptions about the ease of use of a new system. With increasing experience, it is expected that system-specific perceived ease of use, while still anchored to the general beliefs regarding computers and computer use, will adjust to reflect objective usability, perceptions of external control specific to the new system environment, and system-specific perceived enjoyment. The proposed model was tested in three different organizations among 246 employees using three measurements taken over a three-month period. The proposed model was strongly supported at all points of measurement, and explained up to 60% of the variance in system-specific perceived ease of use, which is twice as much as our current understanding. Important theoretical and practical implications of these findings are discussed.

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Determinants of Perceived Ease of Use: Integrating Control, Intrinsic Motivation, and Emotion into the Technology Acceptance Model

The growing interest in Structured Equation Modeling (SEM) techniques and recognition of their importance in IS research suggests the need to compare and contrast different types of SEM techniques so that research designs can be selected appropriately. After assessing the extent to which these techniques are currently being used in IS research, the article presents a running example which analyzes the same dataset via three very different statistical techniques. It then compares two classes of SEM: covariance-based SEM and partial-least-squaresbased SEM. Finally, the article discusses linear regression models and offers guidelines as to when SEM techniques and when regression techniques should be used. The article concludes with heuristics and rule of thumb thresholds to guide practice, and a discussion of the extent to which practice is in accord with these guidelines.

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Structural equation modeling and regression: guidelines for research practice

This tutorial explains in detail what factorial validity is and how to run its various aspects in PLS. The tutorial is written as a teaching aid for doctoral seminars that may cover PLS and for researchers interested in learning PLS. An annotated example with data is provided as an additional tool to assist the reader in reconstructing the detailed example.

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A Practical Guide To Factorial Validity Using PLS-Graph: Tutorial And Annotated Example

Familiarity is a precondition for trust, claims Luhmann [28: Luhmann N. Trust and power. Chichester UK: Wiley, 1979. (translation from German)], and trust is a prerequisite of social behavior, especially regarding important decisions. This study examines this intriguing idea in the context of the E-commerce involved in inquiring about and purchasing books on the Internet. Survey data from 217 potential users support and extend this hypothesis. The data show that both familiarity with an Internet vendor and its processes and trust in the vendor influenced the respondents’ intentions to inquire about books, and their intentions to purchase them. Additionally, the data show that while familiarity indeed builds trust, it is primarily people’s disposition to trust that affected their trust in the vendor. Implications for research and practice are discussed.

E-commerce: the role of familiarity and trust

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David Gefen

Papers

Trust and TAM in online shopping: an integrated model

Structural equation modeling and regression: guidelines for research practice

A Practical Guide To Factorial Validity Using PLS-Graph: Tutorial And Annotated Example

E-commerce: the role of familiarity and trust

E-commerce: the role of familiarity and trust