Granger Causality and National Procurement Spending – Applications to the CC130 Hercules Fleet Performance

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Authors
  1. Maybury, D.W.
Corporate Authors
Defence R&D Canada - Centre for Operational Research and Analysis, Ottawa ON (CAN)
Abstract
Using Granger causality tests, we look for relationships in performance and National Procurement spending time series data that can improve forecasting capabilities with the CC130 fleet. We find that no meaningful relationships exist between spending and performance indicators within the spending envelope studied. Our results concord with earlier work based on random matrix theory and minimal spanning trees, which suggest the fleet is robust to spending shocks. We conclude that NP spending changes do not correlate with subsequent CC130 Hercules aircraft performance changes and vice versa. Granger causality tests represent a powerful tool which can be used with future fleet studies.

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Keywords
Granger causality;fleet performance;national procurement spending;time series
Report Number
DRDC-CORA-TM-2011-154 — Technical Memorandum
Date of publication
01 Sep 2011
Number of Pages
36
DSTKIM No
CA037711
CANDIS No
537500
Format(s):
Electronic Document(PDF)

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