Abstract:
This paper introduces the basic building blocks of Structural Equation Modeling (SEM) analyses
with a logical sequence of five processes; model specification, model identification, model estimation,
model testing, and model modification. In a subsequent of this paper, three criteria are presented for judging
the statistical significance and substantive meaning of a theoretical model: non-statistical significance
of the goodness of fit indices, statistical significance of individual parameter estimates for the paths in
the model, and reasonable magnitude and direction parameter estimates. These basic building blocks are
absolutely essential to conduct SEM models.