The author has organized the main body of his text in seven chapters devoted to random variables and stochastic processes, conditional probability and
conditional expectation, normal processes and covariance stationary processes, counting processes and Poisson processes, renewal counting processes, and a wide variety of other related subjects.
For readers not familiar with the
conditional expectation theorem, this result could also be written in the following form, which seems intuitively reasonable:
It is the product of the
conditional expectation and its conditioning joint probability:
Although I may not subscribe to Jarocinski and Smets's interpretation of the
conditional expectation of output or inflation as an indicator of monetary conditions, I do agree with their conclusion that housing is at the core of the business cycle, so it should have a prominent role in the formulation of monetary policy.
Given a realisation of a spatio-temporal point process X of spikes and given a trajectory of the path Y, the solution of the nonlinear filtering problem is the
conditional expectation E[[LAMBDA]|X,Y] which is not explicitly available.
21] as the derivative of the
conditional expectation in (9), evaluated at the mean of [x.
If the loss is proportional to the square of the forecast error then we have a quadratic loss function and the forecast which minimises the expected loss is the
conditional expectation or mean of the forecast density.
The conclusion, drawn from the existing literature, is that while there is no generally accepted model of the stochastic discount factor, its
conditional expectation must be relatively stable in order to explain the stability of the riskless real interest rate.
To employ this approach, take the
conditional expectation of (9) to get:
Tables I and II show the values of the
conditional expectation function, h(z).
The analytical tools for measuring the economic value associated with the exercise of the intellectual property right in a foreign nation are the
conditional expectation of marginal revenues and the
conditional expectation of marginal costs.
More specifically they show how some ideas often considered complex, such as
conditional expectation, can be developed in a systematic way by considering their definition as orthogonal projections in convenient Hilbert spaces.
