• The Korean Journal of Applied Statistics
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• v.26 no.3
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• pp.401-411
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• 2013

This study investigates the controversial chickens-eggs dilemma and empirically performs statistical tests to examine if there exists a causality between them. Granger and Hsiao tests are applied to both level and stationary variables to identify the lead-lag relationships. Each of these test is found to have the robust result where the causality runs from eggs to chickens; in addition, the explanatory power of one variable in variations of the other appears to remain time invariant. The outcome is proved to be valid as the hypothesis test for no structural change in their relationship fails to be rejected.