Thanks a lot!

I have another question on "cointegration", so I will go on this post.

Is it possible to estimate a cointegration with some exogenous
explanatory variables? Since, after testing for exogeneity, I would like
to re-estimate the relation keeping some of the previous endogenous as
exogenous.

Many thanks!

Carlo



On Nov 21, 2005 11:21 AM, "Pfaff, Bernhard Dr."
<[EMAIL PROTECTED]> wrote:

> Dear R - helpers,
> 
> I am using the urca package to estimate cointegration relations, and I
> would be really grateful if somebody could help me with this
> questions:
> 
> After estimating the unrestriced VAR with "ca.jo" I would like to
> impose
> the rank restriction (for example rank = 1) and then obtain the
> restricted estimate of PI to be utilized to estimate the VECM model.
> 
> Is it possible? 
> 
> It seems to me that the function "cajools" estimates the VECM without
> the restrictions. Did I miss something? How is it possible to impose
> them?
> 
> Thanks a lot in advance!
> 
> Carlo
> 
> 
> Hello Carlo,
> 
> you can achieve this, by calculating your desired PI-matrix by hand,
> given
> the slots 'V' and 'W' of your ca.jo object and then execute a
> restricted
> OLS-estimation, if I understand your goal correctly. 
> Please, bear in mind the non-uniqueness of the factorization of the
> PI-matrix by doing so.
> 
> HTH,
> Bernhard    
> 
> 
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