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Time-Varying Model Averaging of Multi-layer Network Vector Autoregressions

Degui Li, Yuying Sun, Boyao Wu

arXiv 24 Jun 2026 · Econometrics · publishedJournal of Econometrics (2020) · 45 citations (OpenAlex)

arXiv:2606.25292 · PDF · DOI · OpenAlex · Extracted main text

Abstract

In this paper, we introduce a flexible time-varying multi-layer network vector autoregression (VAR) model framework for large-scale time series, allowing agents in dynamic systems to interact through multiple channels and incorporating multiple adjacency matrices to capture network spillover effects. We propose a penalized model averaging method to determine a time-varying optimal combination of multi-layer network VAR candidate models whose number may be divergent. Under some regularity conditions, the asymptotic properties such as asymptotic optimality and convergence rates of the proposed time-varying weight estimation are derived in the contexts of both the in-sample fitting and out-of-sample prediction. In addition, we extend the conformal prediction method to construct prediction bands for locally stationary time series. Monte-Carlo simulation studies and an empirical application to forecast CPI inflation by combining multiple network information are given to illustrate reliable finite-sample estimation and predictive performance of the developed methodology.

Citation extraction

62
references
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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
1Li et al (2026) Estimation of grouped time-varying network vector autoregressive models self1.00053100%
2Sun et al (2023) Penalized time-varying model averaging self0.92843100%
3Zhu et al (2017) Network vector autoregression0.81142100%
4Diebold and Yilmaz (2014) On the network topology of variance decompositions: Measuring the connectedness of financial firms0.7375340%
5Chen, Hong and Li (2024) Time-varying forecast combination for factor-augmented regressions with smooth structural changes self0.64422100%
6Sun, Chen and Gao (2025) Model averaging for time-varying vector autoregressions0.64422100%
7Tu and Wang (2025) Quantile prediction with factor-augmented regression: Structural instability and model uncertainty0.64422100%
8Amiti, Redding and Weinstein (2019) The impact of the 2018 tariffs on prices and welfare0.51121100%
9Chen et al (2025) Estimating time-varying networks for high-dimensional time series0.51121100%
10Ciccarelli and Mojon (2010) Global inflation0.51121100%

Showing the top 10 of 61 scored citations.