The objective of this paper is to summarise essential aspects and types of structural change that may contribute to the development of a general theory. First a brief ontological introduction presents the underlying worldview and clarifies the meaning of key terms. Second the basic general mechanisms of structural change are explored and relations among them are pointed out. Finally some consid...

This paper studies nonlinear cointegration models in which the structural coefficients may evolve smoothly over time. These time-varying coefficient functions are well-suited to many practical applications and can be estimated conveniently by nonparametric kernel methods. It is shown that the usual asymptotic methods of kernel estimation completely break down in this setting when the functional...

This paper builds an economic model of the relationship between influence activity and resistance to change in organizations. I show that influence activity can create harmful barriers to change and that the influence costs of change are positively related to the firm’s prospects. The model rationalizes the widely held view that firms often must endure a survival-threatening crisis before meani...

In this paper we propose a sequential testing approach for a structural change in the variance of a time series, which amounts to a procedure with a controlled asymptotic size as we repeat the test. Our approach builds on that taken in Chu, Stinchcombe & White (1996) for structural change in the parameters of a linear regression model. We provide simulation evidence to examine the empirical siz...

Structural change involves a broad set of trends: (i) sectoral reallocations, (ii) rich movements of productive activities between home and market, and (iii) an increase in the scale of productive units. After extending these facts, we develop a model to explain them within a unified framework. The crucial distinction between manufacturing, services, and home production is the scale of the prod...

Detection of structural change is a critical empirical activity, but continuous ‘monitoring’ of series, for structural changes in real time, raises well-known econometric issues that have been explored in a single series context. If multiple series co-break then it is possible that simultaneous examination of a set of series helps identify changes with higher probability or more rapidly than wh...

This paper documents that a significant portion of trade for Taiwan and Korea follows the trend of world trade in moving toward a pattern of vertical specialization (VS). Noteworthy is the manufacturing sector, whose VS shares of exports has been steadily increasing and has accounted for more than 90% of the total VS shares of manufactured exports. For Taiwan, nearly 57% of the growth in export...

It is remarkably easy to test for structural change, of the type that the classic F or “Chow” test is designed to detect, in a manner that is robust to heteroskedasticity of possibly unknown form. This paper first discusses how to test for structural change in nonlinear regression models by using a variant of the Gauss-Newton regression. It then shows how to make these tests robust to heteroske...

In the past decade, we have seen the development of a new set of tests for structural change of unknown timing in regression models, most notably the SupF statistic of Andrews (1993, Econometrica 61, 825}856), the ExpF and AveF statistics of AndrewsPloberger (1994, Econometrica 62, 1383}1414), and the ̧ statistic of Nyblom (1989, Journal of American Statistical Association 84, 223}230). The dis...