Estimation of Taylor rule with smoothing parameter

[res]

Hello,
I am interested in the estimation of Taylor rule with interest rate smoothing, like in the attached picture.
I have done only simple regressions, but I have never done regression with rho(smoothing parameter).
Can anyone suggest how it can be done in EViews?
Thank you in advance!

[startz]

You can specify a regression in EViews by writing out an equation using c(1), c(2), etc as names for the coefficients, as in

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ls y=c(1)*c(2) + c(2)*x

[res]

Thank you for your reply.
I now understand that I porbably need to do this regression with GMM method, I specified everything, but something is wrong as I get message singular matrix. How can I fix this?

[startz]

I think that the problem is that you have both included c and clicked include a constant in the instrument list.

[res]

I deleted c from the instrumental list, but it still does not work and I get message singular matrix. Maybe you have other ideas?
I am so desperate, don't know how to solve this problem.

[startz]

What you've done looks right. Since your model is linear, you might try the TSLS command and see if that works. Also, before you run GMM set c=0.

[res]

What do you mean by set c=0? How can I do that? Will it impact results?
Thank you in advance!

[startz]

Type c=0 into the command line before estimating an equation. This resets the starting values of the coefficients. Not likely to matter, but there's a chance.

[res]

It still does not work.
Tried to do the same way as in this pdf http://coin.wne.uw.edu.pl/~lgoczek/pdf/ ... trics5.pdf, but no results.
The problem only disappears when I remove a constant term c(2) from the regression, but I cannot use such result, I think.
Anyway, thank you for your help and time, I really appreciate that!