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Stationarity with Occasionally Binding Constraints

James A. Duffy, Sophocles Mavroeidis, Sam Wycherley

arXiv 12 Jul 2023 · Econometrics · 2 citations (OpenAlex)

arXiv:2307.06190 · PDF · DOI · OpenAlex · Extracted main text

Abstract

This paper studies a class of multivariate threshold autoregressive models, known as censored and kinked structural vector autoregressions (CKSVAR), which are notably able to accommodate series that are subject to occasionally binding constraints. We develop a set of sufficient conditions for the processes generated by a CKSVAR to be stationary, ergodic, and weakly dependent. Our conditions relate directly to the stability of the deterministic part of the model, and are therefore less conservative than those typically available for general vector threshold autoregressive (VTAR) models. Though our criteria refer to quantities, such as refinements of the joint spectral radius, that cannot feasibly be computed exactly, they can be approximated numerically to a high degree of precision.

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37
references
79
in-text mentions
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distinct cited
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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
1Aruoba, S. B., M. Mlikota, F. Schorfheide, and S. Villalvazo (2022) SVARs with occasionally-binding constraints1.00063100%
2Liebscher, E (2005) Towards a unified approach for proving geometric ergodicity and mixing properties of nonlinear autoregressive processes0.92810480%
3Mavroeidis, S (2021) Identification at the zero lower bound self0.87462100%
4Kheifets, I. L. and P. J. Saikkonen (2020) Stationarity and ergodicity of vector STAR models0.84333100%
5Philippe, M., R. Essick, G. E. Dullerud, and R. M. Jungers (2016) Stability of discrete-time switching systems with constrained switching sequences0.7375260%
6Chan, K. S. and H. Tong (1985) On the use of the deterministic Lyapunov function for the ergodicity of stochastic difference equations0.7373367%
7Ikeda, D., S. Li, S. Mavroeidis, and F. Zanetti (2024) Testing the effectiveness of unconventional monetary policy in Japan and the United States0.73732100%
8Saikkonen, P (2008) Stability of regime switching error correction models under linear cointegration0.73732100%
9De Jong, R. and A. M. Herrera (2011) Dynamic censored regression and the Open Market Desk reaction function0.64422100%
10Hubrich, K. and T. Teräsvirta (2013) Thresholds and smooth transitions in vector autoregressive models, in0.64422100%

Showing the top 10 of 37 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
1Inference on many jumps in nonparametric panel regression models0.40511
2Estimation of a Dynamic Tobit Model with a Unit Root0.40511