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st: additional endogenous variable in a sur regression (translog)
From
Leslie <[email protected]>
To
[email protected]
Subject
st: additional endogenous variable in a sur regression (translog)
Date
Thu, 23 Sep 2010 20:12:26 +0100
Dear stata listers,
To assess economies of scale I am estimating a translog model with
four inputs; k is short hand for capital, l for labour, f for fuel and
m for materials. lnpk, lnpl etc. are the log of the input prices and
lnc is the log of total cost. I estimate the cost equation and the
cost share equations as a system and omit the share equation for
materials. (The cross terms lnpkpk etc. include the factor 0.5.)
To address the potential endogeneity of output, i.e. of lnq, I would
like to instrument it by an additional exogenous variable, lnoutput.