European Journal of Information Systems

, Volume 21, Issue 1, pp 99–112 | Cite as

Analysing quadratic effects of formative constructs by means of variance-based structural equation modelling

  • Jörg Henseler
  • Georg Fassott
  • Theo K Dijkstra
  • Bradley Wilson
Research Article


Together with the development of information systems research, there has also been increased interest in non-linear relationships between focal constructs. This article presents six Partial Least Squares-based approaches for estimating formative constructs’ quadratic effects. In addition, these approaches’ performance is tested by means of a complex Monte Carlo experiment. The experiment reveals significant and substantial differences between the approaches. In general, the performance of the hybrid approach as suggested by Wold (1982) is most convincing in terms of point estimate accuracy, statistical power, and prediction accuracy. The two-stage approach suggested by Chin et al (1996) showed almost the same performance; differences between it and the hybrid approach – although statistically significant – were unsubstantial. Based on these results, the article provides guidelines for the analysis of non-linear effects by means of variance-based structural equation modelling.


partial least squares path modelling PLS non-linear effect quadratic effect 


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Copyright information

© Operational Research Society 2011

Authors and Affiliations

  • Jörg Henseler
    • 1
    • 2
  • Georg Fassott
    • 3
  • Theo K Dijkstra
    • 4
  • Bradley Wilson
    • 5
  1. 1.Institute for Management Research, Radboud University NijmegenThe Netherlands
  2. 2.Higher Institute of Statistics and Knowledge Management (ISEGI), Universidade Nova de LisboaPortugal
  3. 3.Faculty of Business Studies and Economics, University of KaiserslauternGermany
  4. 4.Faculty of Economic and Business, University of GroningenThe Netherlands
  5. 5.School of Media and Communication, RMIT UniversityMelbourneAustralia

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