Order condition
The order condition is the state of a set of simultaneous equations in an econometric system such that all its parameters may be identified.
For an equation in a system of equations to be identified, the number of excluded exogenous variables in that equation must be at least as great as the number of included endogenous variables, less one. However, a stronger argument is the rank condition which is both necessary and sufficient for identification.
Further reading
- Chow, Gregory C. (1983). Econometrics. New York: McGraw-Hill. pp. 117–121. ISBN 0-07-010847-1.
- Maddala, G. S.; Lahiri, Kajal (2009). Introduction to Econometrics (Fourth ed.). New York: Wiley. pp. 357–362. ISBN 978-0-470-01512-4.
External links
This article is issued from
Wikipedia.
The text is licensed under Creative Commons - Attribution - Sharealike.
Additional terms may apply for the media files.