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Next Dates: - Introduction to QuantLib Development with Luigi Ballabio, September 2 - 4, 2013 - £1700
Dave Giles is a Professor of Economics at the University of Victoria, Canada, where he specializes in Econometrics.
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Local vs. Global Approximations
Sun, 08 Jul 2012 11:59:56 GMT
Approximating unknown (continuously differentiable) functions by using a Taylor (MacLaurin) series expansion is common-place in econometrics. However, do you ever pause to recall that such approximations are only locally valid - that is, valid only in a neighbourhood of the (possibly vector) point about which the approximation is made? Unlike some other types of approximations - such as Fourier approximations - they are not globally valid. Does this matter? Is it something we should be...
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