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Covariance-Based Structural Equation Modeling in Small-Sample Settings with p>n

arXiv:2604.16894v1 Announce Type: new Abstract: Factor-based Structural Equation Modeling (SEM) relies on likelihood-based estimation assuming a nonsingular sample covariance matrix, which breaks down

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arXiv:2604.16894v1 Announce Type: new Abstract: Factor-based Structural Equation Modeling (SEM) relies on likelihood-based estimation assuming a nonsingular sample covariance matrix, which breaks down in small-sample settings with p>n. To address this, we propose a novel estimation principle that reformulates the covariance structure into self-covariance and cross-covariance components. The resulting framework defines a likelihood-based feasible set combined with a relative error constraint, enabling stable estimation in small-sample settings where p>n for sign and direction. Experiments on synthetic and real-world data show improved stability, particularly in recovering the sign and direction of structural parameters. These results extend covariance-based SEM to small-sample settings and provide practically useful directional information for decision-making.

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Source: arXiv cs.LG | 2026-04-21

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