<s>
In	O
statistics	O
,	O
the	O
Phillips	B-General_Concept
–	I-General_Concept
Perron	I-General_Concept
test	I-General_Concept
(	O
named	O
after	O
Peter	O
C	O
.	O
B	O
.	O
Phillips	O
and	O
Pierre	O
Perron	O
)	O
is	O
a	O
unit	O
root	O
test	O
.	O
</s>
<s>
That	O
is	O
,	O
it	O
is	O
used	O
in	O
time	O
series	O
analysis	O
to	O
test	O
the	O
null	B-General_Concept
hypothesis	I-General_Concept
that	O
a	O
time	O
series	O
is	O
integrated	O
of	O
order	O
1	O
.	O
</s>
<s>
It	O
builds	O
on	O
the	O
Dickey	B-General_Concept
–	I-General_Concept
Fuller	I-General_Concept
test	I-General_Concept
of	O
the	O
null	B-General_Concept
hypothesis	I-General_Concept
in	O
,	O
where	O
is	O
the	O
first	O
difference	O
operator	O
.	O
</s>
<s>
Like	O
the	O
augmented	B-General_Concept
Dickey	I-General_Concept
–	I-General_Concept
Fuller	I-General_Concept
test	I-General_Concept
,	O
the	O
Phillips	B-General_Concept
–	I-General_Concept
Perron	I-General_Concept
test	I-General_Concept
addresses	O
the	O
issue	O
that	O
the	O
process	O
generating	O
data	O
for	O
might	O
have	O
a	O
higher	O
order	O
of	O
autocorrelation	O
than	O
is	O
admitted	O
in	O
the	O
test	O
equation	O
—	O
making	O
endogenous	O
and	O
thus	O
invalidating	O
the	O
Dickey	O
–	O
Fuller	O
t-test	B-General_Concept
.	O
</s>
<s>
Whilst	O
the	O
augmented	B-General_Concept
Dickey	I-General_Concept
–	I-General_Concept
Fuller	I-General_Concept
test	I-General_Concept
addresses	O
this	O
issue	O
by	O
introducing	O
lags	O
of	O
as	O
regressors	O
in	O
the	O
test	O
equation	O
,	O
the	O
Phillips	B-General_Concept
–	I-General_Concept
Perron	I-General_Concept
test	I-General_Concept
makes	O
a	O
non-parametric	B-General_Concept
correction	O
to	O
the	O
t-test	B-General_Concept
statistic	O
.	O
</s>
<s>
The	O
test	O
is	O
robust	O
with	O
respect	O
to	O
unspecified	O
autocorrelation	O
and	O
heteroscedasticity	B-General_Concept
in	O
the	O
disturbance	O
process	O
of	O
the	O
test	O
equation	O
.	O
</s>
<s>
Davidson	O
and	O
MacKinnon	O
(	O
2004	O
)	O
report	O
that	O
the	O
Phillips	B-General_Concept
–	I-General_Concept
Perron	I-General_Concept
test	I-General_Concept
performs	O
worse	O
in	O
finite	O
samples	O
than	O
the	O
augmented	B-General_Concept
Dickey	I-General_Concept
–	I-General_Concept
Fuller	I-General_Concept
test	I-General_Concept
.	O
</s>
