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Specifying the Unit of Analysis Up to this time, we defined factor analysis solely in terms of identifying structure among « variables. Factor analysis is actually a more general model in that it can identify the struc relationships among either variables or respondents by examining either the correlations b the variables or the correlations between the respondents, * Ifthe objective of the research were to summarize the characteristics, factor analysis wi applied to a correlation matrix of the variables. This most common type of factor ar referred to as R factor analysis, analyzes a set of variables to identify the dimensions | latent (not easily observed). * Factor analysis also may be applied to a correlation matrix of the individual r sp based on their characteristics. Referred to as Q factor analysis, this method comb condenses large numbers of people into distinctly different groups within a1 rger popt ‘The Q factor analysis approach is not utilized frequently because of comput tional diffi Instead, most researchers utilize some type of cluster analysis to group individual t dents. Also see Stewart [36] for other possible combinations of group and variable typ ‘Thus, the researcher must first select the unit of analysis for factor analysis: varia respondents. Even though we will focus primarily on structuring v riables, the option of emg factor analysis among respondents as an altemative to clust a alysis is also available, The cations in terms of identifying similar variables or respondents will be discussed in stage 2 wl correlation matrix is defined. Achieving Data Summarization Versus Data Reduction Factor analysis provides the researcher with wo distinct, but interrelated, outcomes: data s rization and data reduction. In summarizi_g the data, factor analysis derives underlying dime that, when interpreted and understood, describe the data ina much smaller number of concep the original individual variables Data reduction extends this process by deriving an empirica (factor score) for each dimension (factor) and then substituting this value for the original val DATA SUMMARIZATION. The fundamental concept involved in data summarization is the tion of structure. Through structure, the researcher can view the set of variables at various le generalization, ran i g from the most detailed level (individual variables themselves) to th generalized level, where individual variables are grouped and then viewed not for what they sent individua ly, but for what they represent collectively in expressing a concept. For example, variables at the individual level might be: “I shop for specials,” “I usual for the lowest possible prices,” “I shop for bargains,” “National brands are worth more tha brands.” Collectively, these variables might be used to identify consumers who are ¢ nscious” or “bargain hunters.” Factor analysis, as an interdependence technique, differs from the dependence tech discussed in the next section (.e.. multiple regression, discriminant analysis, multivariate a of variance, or conjoint analysis) where one or more variables are explicitly considered the ct or dependent variables and all others are the predictor or independent variables. In factor ar all variables are simultaneously considered with no distinction as to dependent or indep variables. Factor analysis still employs the concept of the variate, the linear composite of vat

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