Permanent and transitory shocks in the presence of asymmetric error correction

C-Tier
Journal: Applied Economics
Year: 2015
Volume: 47
Issue: 25
Pages: 2642-2648

Authors (2)

F. Chan (Curtin University) G. MacDonald (not in RePEc)

Score contribution per author:

0.505 = (α=2.02 / 2 authors) × 0.5x C-tier

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

Abstract

This article highlights the potential importance of asymmetries in the loading vector of a set of cointegrated variables for the construction, analysis and interpretation of permanent and transitory shocks using impulse response functions. We derive an asymmetric version of the Permanent-Transitory decomposition suggested by Gonzalo and Ng (2001) and illustrate the potential importance of such asymmetries using the 'cay' data of Lettau and Ludvigson (2004).

Technical Details

RePEc Handle
repec:taf:applec:v:47:y:2015:i:25:p:2642-2648
Journal Field
General
Author Count
2
Added to Database
2026-01-25