Revisiting Sample Size and Number of Parameter Estimates: Some Support for the N:q Hypothesis

A number of authors have proposed that determining an adequate sample size in structural equation modeling can be aided by considering the number of parameters to be estimated. While this advice seems plausible, little empirical support appears to exist. A previous study by Jackson (2001), failed to find support for this hypothesis, however, there were certain limitations to the study that likely led to the lack of findings. This study revisits the issue with a design modified to be more sensitive to practically significant effects of sample size to parameter estimate ratio. Consequently, some support was found for this hypothesis, notably among overall fit measures and tests. Results indicate that higher values of the observations per parameter ratio had a positive effect for some measures of fit. However, the overall effect was small relative to absolute sample size.