A Practical Guide to using Path Analysis: Mediation and Moderation in Accounting Research

53 Pages Posted: 18 Feb 2021 Last revised: 6 Feb 2022

See all articles by S. Jane (Kennedy) Jollineau

S. Jane (Kennedy) Jollineau

Chapman University - The George L. Argyros School of Business & Economics

Robert M. Bowen

Chapman University - The George L. Argyros School of Business & Economics; University of Washington - Foster School of Business

Date Written: December 16, 2021

Abstract

We use plain-English, figures, and simple math to explain how to use path analysis to test for mediation and moderation. Many theories in accounting research can be conceptualized as mediated, moderated or moderated-mediation models to investigate both simple and complex hypothesized relationships. Analyses using these models capture the dependent nature of an entire set of relationships rather than attempting to make piecemeal inferences from a series of individual regressions that may not be as revealing and may even yield misleading inferences. We introduce tools that help build theory, reduce the number of inferential tests that are relied on, and use bootstrapping for inferential tests of moderated mediation that do not rely on distributional assumptions. We provide two examples from published research to illustrate and apply these concepts. Tools for analysis include PROCESS (Hayes 2020) and structural equation modeling (SEM).

Keywords: theory-based model-building, path analysis, statistics, method, mediation, moderation, indirect versus direct effects, interaction, mechanisms, PROCESS, structural equation modeling (SEM), bootstrapping, confidence intervals

JEL Classification: C12, C18, C87, C90, M41, M42, M49

Suggested Citation

Kennedy Jollineau, S. Jane and Bowen, Robert M., A Practical Guide to using Path Analysis: Mediation and Moderation in Accounting Research (December 16, 2021). Available at SSRN: https://ssrn.com/abstract=3786380 or http://dx.doi.org/10.2139/ssrn.3786380

S. Jane Kennedy Jollineau (Contact Author)

Chapman University - The George L. Argyros School of Business & Economics ( email )

333 N. Glassell
Orange, CA 92866
United States
206.227.7868 (Phone)

HOME PAGE: http://www.chapman.edu/our-faculty/jane-jollineau

Robert M. Bowen

Chapman University - The George L. Argyros School of Business & Economics ( email )

333 N. Glassell
Orange, CA 92866
United States
206.334.0911 (Phone)

HOME PAGE: http://www.chapman.edu/our-faculty/robert-bowen

University of Washington - Foster School of Business ( email )

Box 353226
University of Washington
Seattle, WA 98195-3226
United States
206.334.0911 (Phone)

HOME PAGE: http://foster.uw.edu/faculty-research/directory/robert-bowen/

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