6533b7d2fe1ef96bd125e98d

RESEARCH PRODUCT

Testing the stationarity of interest rates using a SUR approach

Christoph Balz

subject

Economics and EconometricsSeries (mathematics)Unit root testStatisticsEconomicsEconometricsPhillips–Perron testUnit rootDickey–Fuller testSeemingly unrelated regressionsMaturity (finance)Augmented Dickey–Fuller testFinance

description

Abstract Using data on average yields to maturity of German bonds with different time to maturity it is shown that the time series contain a unit root if the standard augmented Dickey–Fuller test is applied separately to each series. To improve the power of the test we carried out a recently developed approach, estimating the regressions for each time to maturity jointly using a seemingly unrelated regressions approach.

https://doi.org/10.1016/s0165-1765(98)00095-0