Stock markets and their relationship

with the real economy in Latin America

with the real economy in Latin America

Both normality and heteroscedasticity should have the same conditions as if estimated through OLS, that is their probability should be greater than 0.05, which is equivalent to the value of the F statistic being greater than the value tabulated; the null hypothesis can therefore be rejected in terms of nonexistence of normality and heteroscedasticity. The stability tests the characteristic roots, which should be less than 1, or in geometric terms within the circle.

Figure 3. Circle of Root Characteristics

Source: Prepared by the authors on the basis of data supplied by CEPALStat and Economática