Moderator Variables

Abstract

Moderation occurs when the magnitude and/or direction of the relation between two variables depend on the value of a third variable called a moderator variable. Moderator variables are distinct from mediator variables, which are intermediate variables in a causal chain between two other variables, and confounder variables, which can cause two otherwise unrelated variables to be related. Determining whether a variable is a moderator of the relation between two other variables requires statistically testing an interaction term. When the interaction term contains two categorical variables, analysis of variance (ANOVA) or multiple regression may be used, though ANOVA is usually preferred. When the interaction term contains one or more continuous variables, multiple regression is used. Multiple moderators may be operating simultaneously, in which case higher-order interaction terms can be added to the model, though these higher-order terms may be challenging to probe and interpret. In addition, interaction effects are often small in size, meaning most studies may have inadequate statistical power to detect these effects. When multilevel models are used to account for the nesting of individuals within clusters, moderation can be examined at the individual level, the cluster level, or across levels in what is termed a cross-level interaction. Within the structural equation modeling (SEM) framework, multiple group analyses are often used to test for moderation. Moderation in the context of mediation can be examined using a conditional process model, while moderation of the measurement of a latent variable can be examined by testing for factorial invariance. Challenges faced when testing for moderation include the need to test for treatment by demographic or context interactions, the need to account for excessive multicollinearity, and the need for care when testing models with multiple higher-order interactions terms.

The Leader Oversight Bias in Justice and Hypocrisy Evaluations of Organisational Diversity Practices

“…Although this seemingly contradicts the lack of a gender moderation between anticipatory justice and perceived justice, it should be noted that the interaction and moderation are distinct tests. Moderation analysis tests for significant differences between the regression slopes of men and women for the anticipatory-perceived justice relationship and thus retains anticipatory and perceived justice as two separate constructs, whereas the ANOVA interaction demonstrates that the mean difference between anticipatory and perceived justice is significantly greater for women than for men (Fritz & Arthur, 2017;Vosgerau & Gatignon, 2007), treating justice as a single construct measured at different times. This is addressed further in the discussion.…”

Leader oversight bias in justice and hypocrisy evaluations of organisational diversity practices

“…moderation are distinct tests. Moderation analysis tests for significant differences between the regression slopes of men and women for the anticipatory-perceived justice relationship and thus retains anticipatory and perceived justice as two separate constructs, whereas the ANOVA interaction demonstrates that the mean difference between anticipatory and perceived justice is significantly greater for women than for men (Fritz & Arthur, 2017;Vosgerau & Gatignon, 2007), treating justice as a single construct measured at different times. This is addressed further in the discussion.…”

Moderating Effect of Enterprise Risk Management on the Relationship Between Board Structures and Corporate Performance

“…A moderator variable is a third variable that impacts the strength of the relationship between an independent and dependent variable (Matthew & Ann, 2017). In a relationship, if S is the predictor variable (first variable) and T is a resultant variable (second variable), then Q is the moderator variable (third variable) that influences the relationship of S and T (Baron & Kenny, 1986;Kim et al, 2001).…”

“…Therefore, consistent with Baron and Kenny (1986), the ERM is introduced in the present study (as a moderator) with the expectation of determining and improving the relationship between board structure and corporate performance. Since the moderating variable is a variable that alters the direction or strength of a relationship between independent and dependent variables (Sekaran & Bougie, 2016;Matthew & Ann, 2017), the ERM will fit well to act as a moderator. Conceptually, this moderating role of ERM may produce better results for better firm performance through appropriate regulation of its board structure.…”