The error term in formative measurement models: interpretation and modeling implications

Purpose To clarify the nature of the error term in formative measurement models, as it had been misinterpreted in prior research. Design/methodology/approach The error term in formative measurement models is analytically contrasted with the measurement errors typically found in reflective measurement models. Findings It is demonstrated that, unlike in reflective measurement, the error term in formative models is not measurement error but rather...