EViews.com

I'm not able to find out what Eviews does by doing the two stages manually. When you say that you are sure Eviews get it right, do you mean that the reduced form equation of the first stage is estimated with non-linear methods when using "@inst log(x1) log(x2) dummy" as intrument list. The...

I agree, but my problem is how can I be sure that Eviews take care of this properly. As you see we have a model that is non-linear in variables and after doing some algebra the reduced form equations are: log(y1) = [c1/(1- c2*c5-c3*c5*dummy)]log(x1) + [(c2*c4 +c3*c4*dummy)/(1- c2*c5-c3*c5*d)]log(x2)...

I have a 2 equation system I want to estimate with TSLS. I wonder how I should define intrument for a dummy when it interacts with endogenous variable. A simplified example shows my problem where Y1 and Y2 are endogenous: log(Y1)=C(1)*log(X1) + C(2)*log(Y2) + C(3)*dummy*log(Y2) log(Y2)=C(4)*log(X2) ...