Granger Causality and National Procurement Spending: Applications to the CC130 Hercules Fleet Performance
DEFENCE RESEARCH AND DEVELOPMENT CANADA OTTAWA (ONTARIO) CENTRE FOR OPERATIONAL RESEARCH AND ANALYSIS
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Using Granger causality tests, we look for relationships in performance and National Procurement spending time series data that can improve forecasting capabilities with the CC130 fleet. We find that no meaningful relationships exist between spending and performance indicators within the spending envelope studied. Our results concord with earlier work based on random matrix theory and minimal spanning trees, which suggest the fleet is robust to spending shocks. We conclude that NP spending changes do not correlate with subsequent CC130 Hercules aircraft performance changes and vice versa. Granger causality tests represent a powerful tool which can be used with future fleet studies.
- Logistics, Military Facilities and Supplies