A Critical Assessment for Sport Management Research: Comparing PLS-SEM and CB-SEM Techniques for Moderation Analysis Using Formative Measures

Historically, researchers in the sport management area have used covariance based structural equation modeling (CB-SEM) when testing complex models. Recently, researchers have been using partial least squares path modeling (often called PLS-SEM) more frequently. The purpose of this paper was to advise sport management researchers about what approach to use by comparing PLS-SEM versus CB-SEM analytical techniques on the two different types of models: a formative (composite indicator) multigroup model and, a formative (composite indicator) continuous interaction model. We collected data from individuals (N = 1155) in the New England area (USA). After testing a base model, a multigroup model, and a continuous interaction model, we feel that PLS-SEM is the better choice for sport management researchers when testing formative models that use a composite variable. Our research shows when and why each technique works, in addition to showing that PLS-SEM moderation and multigroup models with formative items can work in the R statistical software.