A key factor in forecasting a region's growth is anticipating how a region will respond to changes in national policy. One important way national policy affects a region is through real interest rates. Forecasting regional growth, therefore, requires good estimates of the interest rate...

The nature of yield curve dynamics and the determinants of the integration order of yields are investigated using a benchmark economy in which the logarithmic expectations theory holds and the regularity condition of a limiting yield and limiting term premium is satisfied. By considering a...