From Nuisance to Novel Research Questions: Using Multilevel Models to Predict Heterogeneous Variances

Abstract

Constructs that reflect differences in variability are of interest to many researchers studying workplace phenomena. The aggregation methods typically used to investigate “variability-based” constructs suffer from several limitations, including the inability to include Level 1 predictors and a failure to account for uncertainty in the variability estimates. We demonstrate how mixed-effects location-scale (MELS) and heterogeneous variance models, which are direct extensions of traditional mixed-effects (or multilevel) models, can be used to test mean (location)- and variability (scale)-related hypotheses simultaneously. The aims of this article are to demonstrate (a) how the MELS and heterogeneous variance models can be estimated with both nested cross-sectional and longitudinal data to answer novel research questions about constructs of interest to organizational researchers, (b) how a Bayesian approach allows for the inclusion of random intercepts and slopes when predicting both variability and mean levels, and finally (c) how researchers can use a multilevel approach to predict between-group heterogeneous variances. In doing so, this article highlights the added value of viewing variability as more than a statistical nuisance in organizational research.