Dear Statlist,
I am estimating a system of Engel Curves. However there are two endogenous
variables in my RHS (of every equation) for which I need to use IVs. Given
that the budget shares add up to one for all equations together in the
LHS, I need to incorporate certain adding up restrictions on the RHS
parameters. Ideally, Seemingly Unrelated Regression is what I would like
to do. But how can I incorporate the IVs along with -sureg- in Stata. I
tested for exogeniety of these variables using ivendog- and found that two
of my variables are endogenous. I am not sure if this question is due to
my lack of sufficient knowledge about SUR.
Thanking you in advance.
Rijo John.
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