Globalization and technological innovations create investment opportunities for firms worldwide. In fact, while firms pursue foreign direct investment (FDI) opportunities on a global basis, countries compete to attract these flows. Investment decisions by firms depend on complex and distinct...

In order to group the observations of a data set into a given number of clusters, an ‘optimal’ subset out of a greater number of explanatory variables is to be selected. The problem is approached by maximizing a quality measure under certain restrictions that are supposed to keep the subset...

Using the statistical technique of fuzzy clustering, regimes of inflation and unemployment are explored for the United States, the United Kingdom and Germany between 1871 and 2009. We identify for each country three distinct regimes in inflation/unemployment space. There is considerable...

We investigate the combination of the dimension reduction methods SIR (Li, 1991) and DAME (Gather et al., 2001) with fuzzy-clustering to validate a given classification. We consider certain economic variables which are assumed to contain the information relevant to determine the current phase of...

The literature on business cycle synchronization in Europe frequently presumes an alleged ‘core‒periphery’ pattern without providing empirical verification of the underlying cyclical (dis)similarities or the supposed but unobservable ‘European business cycle(s)’. To provide a...

We present the R package trajeR which provides all necessary tools to calibrate generalized finite mixture models, plot the results graphically and test the model adequacy.First, we give an overview of the generalized finite mixture model for clustering time series and describe the core function...