A Computer Algorithm for Order Estimation of Markov Chain with an Application

This paper deals with the problem of estimating the order of Markov chains. An algorithm is proposed for this purpose and programmed by MATLABR2009a, such that the maximum order is selected automatically after inputting of observations and the upper limit of the order. A simulation study is carried out to verify the efficiency of the algorithm, then the algorithm is applied to the observations of rainfall in the city of Mosul for the years 1994-2000 .It is clear from this application that the daily rainfall in Mosul city is with order 1.