ABSTRACT
This chapter introduces the seasonal adjustment model as an example of extensions of the trend model. Many economic time series repeatedly show similar patterns in the same season of every year. In judging a tendency of a time series or predicting the series, one should carefully take into account these characteristics to avoid misleading results. A seasonal adjustment method is developed for analyzing time series that repeat similar patterns of variation at a constant interval. However, the apparently most natural model for seasonal adjustment would not work well in practice, because the trend component model and the seasonal component model both contain the common factor The function season can also perform long-term prediction based on the estimated seasonal adjustment model. For that purpose, use the argument filter to specify the data period to be used for the estimation of the parameters.
