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Wild inference for wild SVARs with application to heteroscedasticity-based IV

Bulat Gafarov, Madina Karamysheva, Andrey Polbin, Anton Skrobotov

arXiv 3 Jul 2024 · Econometrics · 1 citations (OpenAlex)

arXiv:2407.03265 · PDF · DOI · OpenAlex · Extracted main text

Abstract

Structural vector autoregressions are used to compute impulse response functions (IRF) for persistent data. Existing multiple-parameter inference requires cumbersome pretesting for unit roots, cointegration, and trends with subsequent stationarization. To avoid pretesting, we propose a novel dependent wild bootstrap procedure for simultaneous inference on IRF using local projections (LP) estimated in levels in possibly nonstationary and heteroscedastic SVARs. The bootstrap also allows efficient smoothing of LP estimates. We study IRF to US monetary policy identified using FOMC meetings count as an instrument for heteroscedasticity of monetary shocks. We validate our method using DSGE model simulations and alternative SVAR methods.

Citation extraction

76
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177
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
1Montiel Olea, J. L. and M. Plagborg-Mller (2019) Simultaneous confidence bands: Theory, implementation, and an application to SVARs1.00053100%
2Christiano, L. J., M. Eichenbaum, and C. L. Evans (1999) Monetary policy shocks: What have we learned and to what end?0.97413492%
3Antolń-Dáz, J. and J. F. Rubio-Ramirez (2018) Narrative sign restrictions for SVARs0.874122100%
4Andrews, D. W (1991) Heteroskedasticity and autocorrelation consistent covariance matrix estimation0.8434375%
5Goncalves, S. and L. Kilian (2004) Bootstrapping autoregressions with conditional heteroskedasticity of unknown form0.84333100%
6Jordà, Ò (2005) Estimation and inference of impulse responses by local projections0.84333100%
7Montiel Olea, J. L. and M. Plagborg-Mller (2021) Local projection inference is simpler and more robust than you think0.84333100%
8Inoue, A. and L. Kilian (2016) Joint confidence sets for structural impulse responses0.81142100%
9Smets, F. and R. Wouters (2007) Shocks and frictions in US business cycles: A Bayesian DSGE approach0.81142100%
10Sims, C. A., J. H. Stock, and M. W. Watson (1990) Inference in linear time series models with some unit roots0.7948350%

Showing the top 10 of 76 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
1Projection Inference for Set-Identified SVARs0.40511