Chair of Innovation, Competition Policy and New Institutional Economics

2012-13

Number
2012-13
Authors
Sven Offick, Hans-Werner Wohltmann
Title
A terminological note on cyclotomic polynomials and Blaschke matrices
Abstract In a recent paper, Mertens and Ravn (2010) study the effects of anticipated fiscal policy shocks in a structural vector autoregressive model. The authors maintain that (i) the lag polynomial associated with news shocks is a cyclotomic polynomial and (ii) the matrix B(L) which transforms a nonfundamental MA representation into a fundamental one is a Blaschke matrix. Though the results in Mertens and Ravn (2010) are correct, we find that the terms ‘cyclotomic’ and ‘Blaschke matrix’ are misused.

Keywords: Nonfundamentalness, Cyclotomic polynomial, Blaschke matrix

JEL classification: C32, E32
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