estimating model with added observable exogenous variables

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estimating model with added observable exogenous variables

Postby antmoreno » Fri Jul 18, 2008 11:04 am

Hi all,

I am trying to estimate a model with three endogenous variables, three equations, three shocks AND TWO ADDITIONAL OBSERVABLE EXOGENOUS VARIABLES... a limited information model, that is to say.

I cannot get it to work. How should I call the two additional exogenous variables: as endogenous or exogenous? Should I write three or five equations (where the last two eqns would be identity eqns)?

Thanks so much for your help,

Antonio
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Postby reubenpjacob » Sun Jul 20, 2008 6:03 am

you need as many shocks (or more ) as you have observables.
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Postby antmoreno » Mon Jul 21, 2008 9:22 am

Thanks so much, Reuben. I already made it to work.
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