Approaches to Testing Interaction Effects Using Structural Equation Modeling Methodology

Abstract Use of structural equation modeling (SEM) methodology to study interactive relationships among latent variables began with the work of Kenny and Judd (1984) who developed a method of testing interactions involving continuous latent variables by forming products of multiple indicator variables. Until recently, there has been considerable difficulty implementing the method in SEM programs. This article reviews a single indicator approach (Joreskog & Yang, 1996) and multiple indicator approaches (Jaccard & Wan, 1995; Ping, 1996) that simplify Kenny and Judd's method. An illustrative application using an empirical example examining the interactive effect of perceptions of competence and perceptions of autonomy on exercise intrinsic motivation is presented. Practical issues surrounding the use of these different approaches are discussed.