Spurious Regression: When Trends Create False Relationships
Spurious regression makes unrelated trending series look strongly connected, with high R-squared and large t-statistics. Learn why it happens, how...
Time Series Econometrics
Inflation Persistence: Why Past Inflation Drives Future Inflation
Inflation persistence measures how strongly past inflation drives future inflation. It collapsed after the Volcker disinflation and rebounded modestly during...
Vector Autoregression: VAR Impulse Responses
vector autoregression explains how inflation and unemployment interact through lagged feedback, coefficient matrices, and impulse response functions with confidence bands.