Abstract.There is no effective bivariate feedback relationship between Lydia Pinkham monthly dollar sales and advertising. The effectiveness is measured in terms of the forecasting performance of the bivariate models against the forecasting performance of the respective univariate models, outside the fit period. While the future advertising is better forecast by using the past advertising and sales, the future sales are better forecast by using past sales only. There is no Koyck effect or memory effect of advertising on sales. The results are completely opposite to the conclusion of the previous researchers.
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