Chapter 2 - Key features of economic time series Flashcards
1
Q
What is a trend ?
A
Average growth rate different than 0.
y_t - y_t-1 = mu + u_t
2
Q
What is seasonality?
A
Model with seasonal variable
3
Q
What are aberrant observations ?
A
.
4
Q
Nonlinearity
A
y_t - y_(t-1) = mu_1*I_t[extension] +mu_2 *I_t[recession] + u_t.
5
Q
What are structural change or structural breaks?
A
When the typical features are not constant/invariant over time. Slope of a trend may change.
