I have read other posts on conducting Factor analysis (FA) with dichotomous variables and although it appears clear that FA done in the default way is not appropriate, I am still unclear about a few things.
I have 7 variables that are yes/no responses. They are assessing peoples functioning (e.g., working yes/no, involvement with justice system yes/no etc). I want to combine these responses to have two variables that represent domains of functioning (e.g., occupational and social). I suspect three of them will be occupational and 4 of them social. I would like to do something analogous to a FA to confirm this.
I only have access to SPSS (and am only familiar with this package) so am looking for advice on how to do this with SPSS.
Do I do a FA with tetrachoric correlations instead of Pearsons (how is this done?)? Or can I do Latent Trait Analysis in SPSS?
I am specifically looking for references with step-by-step instructions.