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- Title
Is There Chaos in the World Economy? A Nonparametric Test Using Consistent Standard Errors.
- Authors
Shintani, M.; Linton, O.
- Abstract
A positive Lyapunov exponent is one practical definition of chaos. We develop a formal test for chaos in a noisy system based on the consistent standard errors of the nonparametric Lyapunov exponent estimators. For international real output series, the hypothesis of the positive Lyapunov exponent is significantly rejected in many cases. One possible interpretation of this result is that the traditional exogenous models are better able to explain business cycle fluctuations than is the chaotic endogenous approach. However, our results are subject to a number of caveats.
- Subjects
MATHEMATICAL models of economics; CHAOS theory; LYAPUNOV exponents
- Publication
International Economic Review, 2003, Vol 44, Issue 1, p331
- ISSN
0020-6598
- Publication type
Article
- DOI
10.1111/1468-2354.t01-1-00073