Abstract
Despite the academic value of factor analysis (FA) on Likert scale data, its statistical legality has been relentlessly questioned by professional statisticians. This article reviews relevant literature and
proposes a statistically appropriate method of getting most out of FA on Likert scale. The review shows that
a larger sample size is an important consideration in improving the appropriateness of FA on LS as it improves the solution in terms of normality, communalities and loadings. Further, a 7-9 point or greater scale
to account for normality, an alpha level of 0.01 or 0.005, polychoric correlation instead of Pearson’s are reported to improve the statistical appropriateness of the test of Likert scale. Moreover, using non-parametric
alternatives like CATPCA to testify the results of FA greatly increased the overall value and validity of the test.
Nadeem Uz Zaman, Zainab Bibi, Abdul Raziq, Sana Ur Rehman Sheikh. (2020) Manualizing Factor Analysis of Likert Scale Data, Journal of Management Sciences, Volume 7, Issue 1.
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