Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/322861 
Year of Publication: 
2011
Series/Report no.: 
Discussion Papers Series No. 11-19
Publisher: 
Utrecht University, Utrecht School of Economics, Tjalling C. Koopmans Research Institute, Utrecht
Abstract: 
We show how to estimate a Cronbach's alpha reliability coefficient in Stata after running a principal component or factor analysis. Alpha evaluates to what extent items measure the same underlying content when the items are combined into a scale or used for latent variable. Stata allows for testing the reliability coefficient (alpha) of a scale only when all items receive homogenous weights. We present a user-written program that computes reliability coefficients when implementation of principal component or factor analysis shows heterogeneous item loadings. We use data on management practices from Bloom and Van Reenen (2010) to explain how to implement and interpret the adjusted internal consistency measure using afa.
Subjects: 
afa
factor analysis
Cronbach's alpha
reliability
heterogeneous scale construction
latent variable
Document Type: 
Working Paper

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