modelling simultaneous equations using REG3 command with the endog() option

[naveed ahmed]

Dear Statalisters,

I am trying to estimate the following system of equations using the reg3 command with the endog() option

y1,y2 and x1 are endogeneous variables and z1-z4 are instruments

reg3 (y1 y2 x1 x2 z1 z2) (y2 y1 x1 x2 z2 z4) , endog(x1 )

however, when I run this on STATA15 I get the following message : equation is not identified -- does not meet order conditions. I am not sure how to proceed further and any help would be very useful.

Regards,
Naveed

[Phil Bromiley]

You'll increase your chances of a useful answer by following the FAQ on askgin questions - provide Stata code in code delimiters, readable Stata output, and sample data using dataex.

The reg3 documentation discusses the order condition. Have you read it? You probably need more exogenous variables.