Hierarchical Modeling of the Relationships Between Internalizing Psychiatric Symptom Factors and Attitudes to Risk and Ambiguity Using a Laplace-based Variational Approximation

Common hypotheses in psychiatric research regard relationships between latent variables such as risk-taking and ambiguity attitudes, alongside psychiatric symptoms. The prevailing methodological approach is to estimate the latent variables in a first step, and in a second step, use these estimates in the statistical analysis. Using estimates instead of their true values can lead to bias and reduced power. This study aims to develop a new hierarchical method, based on a Laplace-based variational approximation, to mitigate these issues. The developed method outperforms the prevailing method in terms of power, accuracy and out-of-sample prediction. An empirical example demonstrates the usefulness of the method. The developed approach is computationally efficient and suitable to apply to many data types.