https://communities.sas.com/t5/SAS-Forecasting-and-Econometrics/VAR-Model-with-Dummy/m-p/896894#M4736 I am currently studying the relationship between happiness index during COVID and some other macroeconomic variables. I would like to predict the happiness index by a VAR model with a few macroeconomic variables (i.e. unemployment, GDP) and a dummy (which is 1 = COVID and 0 = normal) whereby COVID is the hardest hit times during COVID technically Year 2020 - 2021.<BR /><BR />SHould I set DUMMY as an exogenous variable in my VAR model since I have a preset values which I know and does not need the model to predict for me. Also, technically by setting the DUMMY as an endogenous variable, does it make sense that I let a VAR model predict a dummy (Yes/No outcome)?<BR /><BR />Appreciate guidance as I am still new to this. Tue, 03 Oct 2023 10:24:39 GMT itslarajean 2023-10-03T10:24:39Z https://communities.sas.com/t5/SAS-Forecasting-and-Econometrics/VAR-Model-with-Dummy/m-p/896894#M4736 I am currently studying the relationship between happiness index during COVID and some other macroeconomic variables. I would like to predict the happiness index by a VAR model with a few macroeconomic variables (i.e. unemployment, GDP) and a dummy (which is 1 = COVID and 0 = normal) whereby COVID is the hardest hit times during COVID technically Year 2020 - 2021.<BR /><BR />SHould I set DUMMY as an exogenous variable in my VAR model since I have a preset values which I know and does not need the model to predict for me. Also, technically by setting the DUMMY as an endogenous variable, does it make sense that I let a VAR model predict a dummy (Yes/No outcome)?<BR /><BR />Appreciate guidance as I am still new to this. Tue, 03 Oct 2023 10:24:39 GMT https://communities.sas.com/t5/SAS-Forecasting-and-Econometrics/VAR-Model-with-Dummy/m-p/896894#M4736 itslarajean 2023-10-03T10:24:39Z