Questions tagged [simultaneous-equation-model]

In simultaneous equations models, dependent variables are functions of other dependent variables. Thus some of the explanatory variables are jointly determined with the dependent variable. For instance, in the simple model of supply and demand, price and quantity are jointly determined.

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Equilibrium with substitute goods

I am attempting to solve the following problem The demand functions for two substitute goods, the production cost of which equals $c_1$ and $c_2$, are $q_1 = a_1 + b_{11}p_1 + b_{12}p_2$ and $q_2 = ...
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Is this an an endogeneity/simultaneity problem?

I would like to know if the logic in these two situations is correct. Situation 1: Let's say we have a continuous dependent variable, $y_1$, that then has a causal impact on an unobserved variable, $\...
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Are simultaneous equation models out of fashion? Why?

According to Angrist & Pischke "Undergraduate econometrics instruction: Through our classes, darkly" (2017) Tables 2 and 3, econometrics textbooks deemphasized simultaneous equation ...