Estimating the Association between Latent Class Membership and External Variables Using Bias-adjusted Three-step Approaches

Latent class analysis is a clustering method that is nowadays widely used in social science research. Researchers applying latent class analysis will typically not only construct a typology based on a set of observed variables but also investigate how the encountered clusters are related to other, external variables. Although it is possible to incorporate such external variables into the latent class model itself, researchers usually prefer using a three-step approach. This is the approach wherein after establishing the latent class model for clustering (step 1), one obtains predictions for the class membership scores (step 2) and subsequently uses these predicted scores to assess the relationship between…