Bias of determinacy coefficients in confirmatory factor analysis based on categorical variables

Abstract: The relevance of determinacy coefficients as indicators for the validity of factor score predictors has regularly been emphasized. Previous simulation studies revealed biased determinacy coefficients for factor score predictors based on categorical variables. Therefore, and because there are different possibilities to compute determinacy coefficients, the present study compared bias of determinacy coefficients for the best linear factor score predictor and for a correlation-preserving factor score predictor based on confirmatory factor models with observed variables with 2, 4, 6, and 8 categories and maximum likelihood estimation, diagonally weighted least squares estimation, and Bayesian estimation. Positive bias was found when data were based on variables with two categories, population factors were correlated, and when there were unmodeled cross-loadings. Based on the results, the correction for sampling error, the use of maximum likelihood or Bayesian parameters, and data with at least four categories are recommended to avoid overestimation of parameter-based determinacy coefficients.