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Economics

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Apr 3, 2024

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1 EDPY 505 Please submit your preliminary responses by 11:20a.m. on Feb. 3, 2022 here: https://forms.gle/iYxRFYWmceNTMiHk9 You will receive a copy of your responses via email. Paste your responses into Word, revise them, if need be, and submit the Word document on e-class by Tuesday, Feb. 8. LAB 2 Moderation and Mediation Definitions A moderation model proposes that the relationship between two variables depends on a third variable. A mediation model proposes that the independent variable influences the mediator variable, which in turn influences the dependent variable. Why is it important to study moderation and mediation? From a theoretical point of view, they both provide a deeper understanding of the relationship between independent and dependent variables. From a data mining point of view, when you expect an IV to be significant, but it is not, and when the homoscedasticity assumption is violated, you may want to check for a moderation effect. Last updated on Feb. 2, 2022

2 EDPY 505 There is no overall effect, but the drug does reduce pain for male participants. When your treatment does not work, you don’t simply say it does not work. You ask for which subgroups it works, and for which subgroups it does not work. When heteroscedasticity occurs like above, you can often fit several regression lines into the scatter plot. It may indicate that there is a moderator. When you have many predictors in a regression, and the result shows that some theoretically important variables are not significant, consider checking for mediation. For example, in a study of low-income families’ physical health, after putting both housing condition and mental health Last updated on Feb. 2, 2022

3 EDPY 505 in a regression, housing condition is not a significant predictor. Can we conclude that housing condition is not an important variable for physical health? Can we tell policy makers to ignore the housing condition of low-income families? No. In this case, a mediation analysis reveals that housing condition significantly predicts mental health, which significantly predicts physical health. The indirect effect is significant as well. This is why when it comes to decision making, we cannot simply conduct a regression analysis and rule out any non-significant variables. How to test moderation Construct a new interaction variable, which equals to IV*moderator, and do the following regression: DV = b 0 + b 1 IV + b 2 moderator + b 3 IV ∗ moderator + error IV and moderator are centered to have means of 0. For moderation analyses using the process macro, use model number 1. How to test mediation Classic approach:  Check if IV significantly predicts DV  Check if IV significantly predicts mediator  Include both IV and mediator in the regression. Check 1) if the mediator is significant and 2) if the regression coefficient of IV is smaller in absolute value than before. Indirect effect approach:  Sobel test assumes normality of a*b in Figure 10.4 (page 1 of this document) and is NOT very robust to violation of normality. Since a*b is only normally distributed given large sample sizes, Sobel’s test is inaccurate most of the time. (Please refer to the lecture reading about moderation and mediation for more information.)  Compute a bias-corrected bootstrap confidence interval, the preferred method. For mediation analyses using the process macro, use model number 4. Last updated on Feb. 2, 2022

4 EDPY 505 In this lab, we are going to explore the following topics:  How to conduct a moderation analysis using SPSS and interpret the corresponding results  How to conduct a mediation analysis using SPSS and interpret the corresponding results Installing custom dialog boxes in SPSS Download and install file: Download the file process.spd (version 4.0) from eClass. If a new version is available, download it here: www.processmacro.org Save this file onto your computer. Open SPSS, select “Extensions,” “Utilities,” “Install Custom dialog” and open the “Process.spd”. Once the installation is complete, you’ll find that the PROCESS menu has been added to the existing regression menu (Analyze->Regression). Moderation Data The Video Games.sav data file contains data from 442 youths. It measures their aggressive behaviour (Aggression), callous unemotional traits (CaUnTs), and the number of hours per week they play video games (hours). Scenario Past research shows video games are linked to increased aggression in youths (Anderson & Bushman, 2001). Callous unemotional traits such as lack of guilt, lack of empathy, and callous use of others for personal gain are also linked to aggression (Rowe, Costello, Angold, Copeland, & Maughan, 2010). Now, researchers want to know if the strength or direction of the relationship between game-playing and aggression is affected by callous unemotional traits.  A. Which model would you recommend? Moderation o A.1 What is the outcome variable (Y)? Aggression o A.2 What is the independent variable (X)? Video-game playing  B. Which variable is the moderator? Callous unemotional traits  C. Please write the equation. (See p. 3 of this document.) Aggression = b0+(b1+b3Callous) Gaming + b2Callous + error Last updated on Feb. 2, 2022

5 EDPY 505 1. Running the analysis Open the Video Games.sav data file in SPSS. Click Analyze->Regression->Process, by Andrew F.Hayes Select the outcome variable and drag it to the corresponding box. Similarly, select and drag the predictor variable and the moderator variable ( W ). Select Model Number 1 which means moderation model. Click Options. Last updated on Feb. 2, 2022

6 EDPY 505 Check (1) Generate code for visualizing interactions which is helpful for interpreting and visualizing the simple slopes analysis. Select (2) Heteroscedasticity-consistent inference: HC3 (Davidson-MacKinnon). (3) Mean center for construction of products: Only continuous variable that define products. Doing so centers the predictor and moderator for you. (4) Moderation and conditioning if p < .05. (5) Conditioning values: -1SD, Mean, +1SD. (6) Select Johnson-Neyman output. Click Continue. Click OK. Last updated on Feb. 2, 2022

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