A Review and Examination of Demographic Similarity Measures Used to Assess Relational Demography Within Groups

Relational demography within groups, or an individual's demographic similarity to a group, is a type of cross-level theory labeled as an individual-within-the-group model. Previous researchers used three different approaches for measuring the core construct of demographic similarity: the difference score, interaction term, and perceptual approaches. This article provides an in-depth review of the measurement definition, conceptual properties, and limitations of each approach, highlighting similarities and differences among them. Then, the authors use data from four financial service organizations to demonstrate that the three measures minimally relate to one another and differentially relate to work outcomes. Although researchers often use the three measures interchangeably, this article suggests that they assess distinct components of the demographic similarity construct or measure the construct with differing degrees of success. Based on the review, the authors offer best-practice guidelines for researchers as to how to use each approach most effectively.