There is a positive effect of X on M
There is a positive effect of M on Y
M mediates the effect of M X on Y, or
X has an indirect effect on Y through M
In this approach, there is only one hypothesis to be tested:
H1: M mediates the effect of M X on Y, or
H1: X has an indirect effect on Y through M
Download a data-set here, and draw the following model.
Rungtusanatham, M., Miller, J. W., & Boyer, K. K. (2014). Theorizing, testing, and concluding for mediation in SCM research: tutorial and procedural recommendations. Journal of Operations Management, 32(3), 99-113. Click here.