{"status":"ok","message-type":"work","message-version":"1.0.0","message":{"indexed":{"date-parts":[[2026,8,1]],"date-time":"2026-08-01T06:59:48Z","timestamp":1785567588778,"version":"3.56.0"},"reference-count":46,"publisher":"The Econometric Society","issue":"2","license":[{"start":{"date-parts":[[2026,1,1]],"date-time":"2026-01-01T00:00:00Z","timestamp":1767225600000},"content-version":"unspecified","delay-in-days":0,"URL":"https:\/\/creativecommons.org\/licenses\/by-nc\/4.0\/legalcode"}],"content-domain":{"domain":[],"crossmark-restriction":false},"short-container-title":["QE"],"abstract":"<jats:p>\n                    Linear factor models are generally not identified. We provide sufficient conditions for identification: Under a natural sparsity assumption (the presence of local factors that affect only subsets of observables), the true loading matrix is the sparsest rotation and can be recovered by minimizing the\n                    <jats:italic>\u2113<\/jats:italic>\n                    <jats:sub>1<\/jats:sub>\n                    \u2010norm of the loading matrix. This enables economically meaningful interpretation of the individual factors. More generally, our\n                    <jats:italic>\u2113<\/jats:italic>\n                    <jats:sub>1<\/jats:sub>\n                    \u2010rotation criterion offers a novel approach to simplify the loading matrix and performs well relative to existing methods (e.g., Varimax, Kaiser (1958)) in our simulations. We illustrate our method in two economic applications. The R package l1rotation implements the method and facilitates adoption.\n                  <\/jats:p>","DOI":"10.3982\/qe2369","type":"journal-article","created":{"date-parts":[[2026,4,30]],"date-time":"2026-04-30T12:29:57Z","timestamp":1777552197000},"page":"461-496","source":"Crossref","is-referenced-by-count":3,"title":["Identification through sparsity in factor models: The\n                    <i>\u2113<\/i>\n                    <sub>1<\/sub>\n                    \u2010rotation criterion"],"prefix":"10.3982","volume":"17","author":[{"given":"Simon","family":"Freyaldenhoven","sequence":"first","affiliation":[{"name":"Research Department, Federal Reserve Bank of 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