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Hi all,

I get an Oscillating IRF around the zero axis until they die out.

Does anyone know why this may happen ?

I have accounted for seasonality, but do not really understand the source of such unusual fluctuating IRF

Many thanks

An oscillating IRF can occur anytime you have two or more lags, even for a single equation. Essentially, part of the solution to a seond order difference equation with comple roots can involve a sine wave.

Startz, Thank you so much ! That was indeed helpful !

However, for my case i cannot consider it as something normal, since the impulses here describe the fiscal multipliers. I.e dt/dy <=0 and dg/dy >=0
Where t=taxes, g=government spending, y=gdp and d()/d() as usual denote derivatives.

And indeed I had observed myself that the "oscillation" was a function of lags.

Do you recommend / suggest / advice something about this ? cause the maths make sense but not really the economics.

I have applied this VAR specification for a couple of countries but only on one occasion i found such oscillating impulse response.

My only suggestion is to look at the confidence intervals to be sure whether there is really string evidence of the oscillation.

Thanks, Startz. I will try it.

Hello,
I'm estimating a SVAR with long-run restrictions and want to simulate disinflation's shocks. So,
1- how can'i simulate explicitly a negative shock on Eviews? i think, by default, Eviews simulates positive shocks.
2- On the other hand, how can'i simulate a 1% shock, a 2% shock, and so on.....to then obtain IRF from a 1% shock, 2% shock, 3% shock.....

Thanks!!
As my english is not good i try in french!

En fait je travaille sur les politiques de désinflation, alors j'ai des préoccupations de deux ordres:
1- Comment simuler un choc négatif sur Eviews? car j'ai l'impression que par défaut, les IRF sont issues de chocs positifs?
2- Comment simsuler des chocs de 1%, 2%, 3% et ainsi de suite sur Eviews? j'ai l'impression que par defaut les IRF sont issues de chocs de 1% uniquement.
Merci davance!!