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Semiparametric Functional Factor Models with Bayesian Rank Selection

Daniel R. Kowal, Antonio Canale

arXiv 4 Aug 2021 · Statistics — Methodology · publishedBayesian Analysis (2023) · 15 citations (OpenAlex)

arXiv:2108.02151 · PDF · DOI · OpenAlex · Extracted main text

Abstract

Functional data are frequently accompanied by a parametric template that describes the typical shapes of the functions. However, these parametric templates can incur significant bias, which undermines both utility and interpretability. To correct for model misspecification, we augment the parametric template with an infinite-dimensional nonparametric functional basis. The nonparametric basis functions are learned from the data and constrained to be orthogonal to the parametric template, which preserves distinctness between the parametric and nonparametric terms. This distinctness is essential to prevent functional confounding, which otherwise induces severe bias for the parametric terms. The nonparametric factors are regularized with an ordered spike-and-slab prior that provides consistent rank selection and satisfies several appealing theoretical properties. The versatility of the proposed approach is illustrated through applications to synthetic data, human motor control data, and dynamic yield curve data. Relative to parametric and semiparametric alternatives, the proposed semiparametric functional factor model eliminates bias, reduces excessive posterior and predictive uncertainty, and provides reliable inference on the effective number of nonparametric terms--all with minimal additional computational costs.

Citation extraction

35
references
78
in-text mentions
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distinct cited
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main-text words

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Most heavily cited references

The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.

ReferenceIntensityMentionsSectionsMain text
1Nelson, C. R. and Siegel, A. F (1987) Parsimonious Modeling of Yield Curves1.00094100%
2Kowal, D. R (2020) Dynamic Regression Models for Time-Ordered Functional Data self1.00054100%
3Diebold, F. X. and Li, C (2006) Forecasting the term structure of government bond yields0.92843100%
4Castillo, I. and van der Vaart, A (2012) Needles and straw in a haystack: Posterior concentration for possibly sparse sequences0.81142100%
5Teh, Y. W., Grür, D., and Ghahramani, Z (2007) Stick-breaking construction for the Indian buffet process0.73732100%
6Legramanti, S., Durante, D., and Dunson, D. B (2020) Bayesian cumulative shrinkage for infinite factorizations0.69381100%
7Ramsay, J. O., Wang, X., and Flanagan, R (1995) A functional data analysis of the pinch force of human fingers0.64441100%
8Ramsay, J. O (2000) Functional components of variation in handwriting0.64422100%
9Goldsmith, J. and Kitago, T (2016) Assessing systematic effects of stroke on motor control by using hierarchical function-on-scalar regression0.64422100%
10Rockova, V (2018) Bayesian estimation of sparse signals with a continuous spike and slab prior0.64422100%

Showing the top 10 of 35 scored citations.

Cited by, within the corpus

arXiv econ.EM papers that cite this one, ranked by how heavily they lean on it.

Citing paperIntensityMentionsSections
1Generalized Cumulative Shrinkage Process Priors with Applications to Sparse Bayesian Factor Analysis1.000245
2Approximate Factor Models for Functional Time Series0.40511