Consider the bivariate case (k=2) of a VAR(1) model:

What restrictions do the coefficients fulfill in order to have a one-way relationship from a series to the other? What restrictions do the coefficients fulfill in order to have a feedback relationship between the series? b) Let r_1t and r_2t be two series of some topic of interest to you. Describe a situation in which you would expect a unidirectional relationship between the series.

r1t=10+11r1,t1+12r2,t1+a1t r2t=20+21r1,t1+22r2,t1+a1t