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Description: Previous research and methodological advice has focused on the importance of accounting for measurement error in psychological data. That perspective assumes that psychological variables conform to a common factor model, such that they consist of construct variance plus error. In this paper, we explore what happens when a set of items that are not generated from a common factor construct model are nonetheless modeled as reflecting a common factor. Through a series of hypothetical examples and an empirical re-analysis, we show that (1) common factor models tend to produce extremely biased and highly variable structural parameter estimates when the population model is not a common factor model; (2) model fit is a poor indicator of the degree of bias; and (3) composite models are sometimes more reliable than common factor models under alternative measurement structures, though they also lead to unacceptably bad solutions in some cases.

Has supplemental materials for WorseThanMeasurementError on OSF Preprints

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