Stability test- how to interpret the results?
Hi everyone,
I am currently doing a time-series analysis using the VECM.
I have one cointegrating equation and 5 parameters. The result of the eigenvalue stability condition is "The VECM specification imposes 4 unit moduli".
As I'm a beginner, I don't really know how to interpret this, and how should I proceed? I have attached the graph too.
Thanks in advance!
I am currently doing a time-series analysis using the VECM.
I have one cointegrating equation and 5 parameters. The result of the eigenvalue stability condition is "The VECM specification imposes 4 unit moduli".
As I'm a beginner, I don't really know how to interpret this, and how should I proceed? I have attached the graph too.
Thanks in advance!
