Score contribution per author:
α: calibrated so average coauthorship-adjusted count equals average raw count
The two-regime Markov-switching model that James Hamilton estimated for US real GNP up to 1984 does not survive extension of the data set. To allow for the ‘Great Moderation’ we require a mean and variance regime that evolve separately. The Markov-switching component model is proposed as a way to avoid estimating a fragile four-regime model. The resulting model captures business cycles and structural change in the variance well.