RDP 2018-02: Affine Endeavour: Estimating a Joint Model of the Nominal and Real Term Structures of Interest Rates in Australia Equation

A n * = π 0 − ρ 0 + A n−1 * + B ˜ n−1 * ′( μ−∑ λ 0 )+ 1 2 B ˜ n−1 * ′∑ ∑ ′ B ˜ n−1 * B n ∗′ =− ρ 1 ′ + B ˜ n−1 * ( θ−∑ λ 1 ) MathType@MTEF@5@5@+=feaagCart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLnhiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=xfr=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jdiIcaakiabgUcaRmaaGaaabaGaaCOqaaGaay5adaWaa0baaSqaaiaad6gacqGHsislcaaIXaaabaGaaiOkaaaakmaabmaabaGaeqiUdeNaeyOeI0IaeyyeIuUaeq4UdW2aaSbaaSqaaiaaigdaaeqaaaGccaGLOaGaayzkaaaaaaa@80C4@