We derive a canonical representation for the no-arbitrage discrete-time term structure models with both observable and unobservable state variables, popularized by Ang and Piazzesi (2003). We conduct a specification analysis based on this canonical representation. We show that some of the...

There has been much interest in the area of model-based reasoning within the Artificial Intelligence community, particularly in its application to diagnosis and troubleshooting. The core issue in this thesis, simply put, is, model-based reasoning is fine, but whence the model? Where do the...