number of instruments greater than number of observations

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dddmb33
Posts: 9
Joined: Thu Aug 11, 2011 8:11 am

number of instruments greater than number of observations

Postby dddmb33 » Thu Aug 11, 2011 8:46 am

hello
how can i fix the problem of receiving the message "number of instruments greater than number of observations"
thanks

startz
Non-normality and collinearity are NOT problems!
Posts: 3798
Joined: Wed Sep 17, 2008 2:25 pm

Re: number of instruments greater than number of observation

Postby startz » Thu Aug 11, 2011 8:56 am

Without meaning to sound frivolous, get more observations or use fewer instruments.

dddmb33
Posts: 9
Joined: Thu Aug 11, 2011 8:11 am

Re: number of instruments greater than number of observation

Postby dddmb33 » Thu Aug 11, 2011 9:06 am

but how can i choose the correct number of instruments

startz
Non-normality and collinearity are NOT problems!
Posts: 3798
Joined: Wed Sep 17, 2008 2:25 pm

Re: number of instruments greater than number of observation

Postby startz » Thu Aug 11, 2011 9:43 am

You need as many, or more, instruments as you have right hand side variables. Past that, you'll have to explain what you're doing and see if someone has more specific advice.


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