Generating DGPs (genr or append)

[Kavorka]

Should I use genr or append when generating DGPs? Please see the question in the attachment.

[EViews Gareth]

In your case they are identical (as shown below):

Code: Select all

create u 100 series e1 = nrnd series e2=nrnd smpl 1 2 series x=nrnd series y=nrnd !nrep = 1 smpl 3 @last scalar rho = 0.3 scalar psi=0.2 FOR !REP=1 TO !NREP genr x = 1 + x(-1) + rho * (x(-1)-x(-2)) + e1 genr y = 1 + y(-1) + rho * (y(-1)-y(-2)) + psi * (x(-1)-x(-2)) + e2 NEXT FOR !REP=1 TO !NREP model mod1 mod1.append x = 1 + x(-1) + rho * (x(-1)-x(-2)) + e1 mod1.append y = 1 + y(-1) + rho * (y(-1)-y(-2)) + psi * (x(-1)-x(-2)) + e2 mod1.solve delete mod1 NEXT show x x0 y y0

If Y depended on X and X depended on Y you would need to use the model.