A Robust Sequential Procedure for Estimating the Number of Structural Changes in Persistence

B-Tier
Journal: Oxford Bulletin of Economics and Statistics
Year: 2020
Volume: 82
Issue: 3
Pages: 669-685

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 proposes a new procedure for estimating the number of structural changes in the persistence of a univariate time series. While the extant literature primarily assumes (regime‐wise) stationarity, our framework also allows the underlying stochastic process to switch between stationary [I(0)] and unit root regimes [I(1)]. We develop a sequential testing approach that maintains correct asymptotic size regardless of whether the regimes are I(0) or I(1). We also propose a novel procedure for distinguishing persistence change processes from those with pure level and/or trend shifts. Monte Carlo simulations and an application to OECD inflation rates highlight the practical usefulness of the procedures.

Technical Details

RePEc Handle
repec:bla:obuest:v:82:y:2020:i:3:p:669-685
Journal Field
General
Author Count
1
Added to Database
2026-01-25