interactive dummy variables in forecasting

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interactive dummy variables in forecasting

Postby freddyg_7 » Sat Mar 26, 2016 9:45 pm

Trust all is well. If you put in interactive dummy variables in an equation like so:

Code: Select all

equation {%asset}"hac")  dlog({%asset}) dlog({%asset}(-1))*@recode(vix>22,1,0) dlog(world_us)*@recode(vix>22,1,0) dlog(vix)*@recode(vix>22,1,0) c dlog({%asset}(-1))*@recode(vix<22,1,0) dlog(world_us)*@recode(vix<22,1,0) dlog(vix)*@recode(vix<22,1,0)

and assuming I have generated forecasts of "VIX". Will the model solver know to apply the conditions inherent in the dummy variables. That is vix>22 or vix<22 ?

Thanks in advance

EViews Gareth
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Re: interactive dummy variables in forecasting

Postby EViews Gareth » Sat Mar 26, 2016 10:15 pm

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