Prediction Oriented Classification in PLS Path Modeling

Structural Equation Modelling methods traditionally assume the homogeneity of all the units on which a model is estimated. In many cases, however, this assumption may turn to be false; the presence of latent classes not accounted for by the global model may lead to biased or erroneous results in terms of model parameters and model quality. The traditional multi-group approach to classification is often unsatisfying for several reasons; above all because it leads to classes homogeneous only with respect to external criteria and not to the theoretical model itself.

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