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

Machine Learning 2026-04-21 v1 Methodology Machine Learning

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>np>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>np>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.

Keywords

Cite

@article{arxiv.2604.16894,
  title  = {Covariance-Based Structural Equation Modeling in Small-Sample Settings with $p>n$},
  author = {Hiroki Hasegawa and Aoba Tamura and Yukihiko Okada},
  journal= {arXiv preprint arXiv:2604.16894},
  year   = {2026}
}

Comments

31 pages, 7 figures and 7 tables

R2 v1 2026-07-01T12:15:50.798Z