Improved Parameters Estimation Of Pair-copula With Its Application In Economics

For the estimation of parameters in pair-copula, the parameters are often assumed to be independ of the conditioning variables and are simplified as constant. In this paper, assumming that the parameters and conditioning variables are not independent, and one parameter is an unary function of conditioning variable. Apply this method to analyze the relationship between the logarithmic growth of the three indexes of "Li Keqiang Index", such as volume of railway freight, Industrial power consumption, and loan amount. The study found that this method is better than the simplifying assumption. And if the volume of railway freight is fixed, the Industrial power consumption and loan amount are negatively correlated. The negative correlation weaken as the volume of railway freight increase.