Partialling Factor Scores Does Not Control Method Variance: A Reply to Podsakoff and Todor

This is the authors' abstract. We don't add key points for this paper.

Podsakoff and Todor (1985) proposed partialling the first principal component from observed correlations as a procedure for controlling method variance. Using mathematical derivations and Monte Carlo simulation, we found that this procedure is biased. Partialling out the first principal component introduces a negative bias into the resulting correlations that seriously compromises subsequent analysis. Moreover, the extent of bias is not reduced by increasing sample size; however, it is inversely proportional to the number of variables. Therefore, partialling the first principal component is not recommended. Researchers are encouraged to collect data with multiple methods whenever feasible.