childofprodigy
05-29-2010, 10:16 PM
When I ran the dickey fuller test on a variable, the test indicates that the t statistics is greater than zero and is greater than the absolute value of the critical values....
However since usually we test the alternative that the t-stat is less than zero, in this case can we reject the null hypothesis that there is unit root in the process?
I know that if the t-stat is greater than zero, it indicates that the variable is explosive, but does this explosive variable have unit root?
However since usually we test the alternative that the t-stat is less than zero, in this case can we reject the null hypothesis that there is unit root in the process?
I know that if the t-stat is greater than zero, it indicates that the variable is explosive, but does this explosive variable have unit root?