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Interactions between level 1 predictors in multilevel models
Thesis   Open access

Interactions between level 1 predictors in multilevel models

Erica Dorman
University of Iowa
Master of Arts (MA), University of Iowa
Autumn 2025
DOI: 10.25820/etd.008220
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Abstract

In multilevel models, interaction terms between two level 1 predictors have different methods of creation due to level 1 predictors containing both within and between variation (Loeys et al., 2018). Previous research on within-level interactions that consist of two level 1 predictors has different suggestions on how to correctly specify this interaction term. The purpose of the study is to understand how parameter estimates and standard errors in multilevel models are impacted by the different methods used to create this interaction term to determine which centering method results in the least amount of bias. A Monte Carlo simulation with 1000 replications was conducted to assess the impacts of the interaction creation order (center first, product first, and double centering), the presence of a nonzero interaction effect, and model type (within-only or within and between). Cluster-mean centering was used for the level 1 predictors in random intercept models. Results indicated that using the center first then product method to create the within-level interaction resulted in the least amount of bias in the parameter estimates. Bias was also found in cross-level interactions and cluster means. The bias in cross-level interaction parameter estimates was explained by both the within-level interaction creation method and the presence of a nonzero interaction effect. Bias in the standard errors for cluster means was not explained by the design conditions.
Quantitative Psychology interactions level 1 predictors multilevel models

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