Testing model nesting and equivalence

When using existing technology, it can be hard or impossible to determine whether two structural equation models that are being considered may be nested. There is also no routine technology for evaluating whether two very different structural models may be equivalent. A simple nesting and equivalence testing (NET) procedure is proposed that uses random sample and model-reproduced moment matrices to evaluate both model nesting and equivalence. The analysis is “local” rather than “global” in nature, but its use with simulation or bootstrapping can imply global conclusions. Two standard applications of NET are to verify whether or not two proposed models are equivalent and whether a baseline model used in an incremental fit index is appropriately nested.Research supported by grants DA00017 and DA01070 from the National Institute on Drug Abuse and grant SEJ2006-13537 from the Spanish Ministry of Science and Technology