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Recent Developments in Factor Models and Applications in Econometric Learning
Book chapter   Open access   Peer reviewed

Recent Developments in Factor Models and Applications in Econometric Learning

Jianqing Fan, Kunpeng Li and Yuan Liao
Annual Review of Financial Economics. Volume 13, pp.401-430
Annual Review of Financial Economics, Annual Reviews
01/01/2021
DOI: 10.1146/annurev-financial-091420-011735
url
https://doi.org/10.1146/annurev-financial-091420-011735View
Published (Version of record) Open Access

Abstract

This article provides a selective overview of the recent developments in factor models and their applications in econometric learning. We focus on the perspective of the low-rank structure of factor models and particularly draw attention to estimating the model from the low-rank recovery point of view. Our survey mainly consists of three parts. The first part is a review of new factor estimations based on modern techniques for recovering low-rank structures of high-dimensional models. The second part discusses statistical inferences of several factor-augmented models and their applications in statistical learning models. The final part summarizes new developments dealing with unbalanced panels from the matrix completion perspective.
Business Economics Social Sciences Business & Economics Business, Finance

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