Title: Is the annual growth rate in balance of trade time series for Ireland nonlinear,
Abstract: We describe the Time Series Multivariate Adaptive Regressions Splines
(TSMARS) method. This method is useful for identifying nonlinear structure in a
time series. We use TSMARS to model the annual change in the balance of trade
for Ireland from 1970 to 2007. We compare the TSMARS estimate with long memory
ARFIMA estimates and long-term parsimonious linear models. We show that the
change in the balance of trade is nonlinear and possesses weakly long range
effects. Moreover, we compare the period prior to the introduction of the
Intrastat system in 1993 with the period from 1993 onward. Here we show that in
the earlier period the series had a substantial linear signal embedded in it
suggesting that estimation efforts in the earlier period may have resulted in
an over-smoothed series.