Cointegration Testing Using Pseudolikelihood Ratio Tests

B-Tier
Journal: Econometric Theory
Year: 1997
Volume: 13
Issue: 2
Pages: 149-169

Score contribution per author:

2.011 = (α=2.01 / 1 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

This paper considers pseudomaximum likelihood estimators for vector autoregressive models. These estimators are used to determine the cointegration rank of a multivariate time series process using pseudolikelihood ratio tests. The asymptotic distributions of these tests depend on nuisance parameters if the pseudolikelihood is non-Gaussian. This even holds if the likelihood is correctly specified. The nuisance parameters have a natural interpretation and can be consistently estimated. Some simulation results illustrate the usefulness of the tests: non-Gaussian pseudolikelihood ratio tests generally have a higher power than the Gaussian test of Johansen if the innovations demonstrate leptokurtic behavior.

Technical Details

RePEc Handle
repec:cup:etheor:v:13:y:1997:i:02:p:149-169_00
Journal Field
Econometrics
Author Count
1
Added to Database
2026-01-25