Equation Spec vs Instrument List
Posted: Tue Dec 03, 2013 1:27 am
I'm a rookie and don't know what i'm doing. Using Eviews 8.
I'm trying to do a 2SLS regression since endogeneity is likely. I want to find the effect of foreign aid on GDP growth. I plan on first establishing a benchmark that looks like:
GDP=c+human capital+trade+public consumption
I will then add my test variable which is foreign aid:
GDP=c + human capital + trade + public consumption + foreign aid
I want to use 1 and 2 lags for all depen and indepn variables.
I'm confused as to how i should type this in my equation specification and my instrument list.
Please help! Thanks!
I'm trying to do a 2SLS regression since endogeneity is likely. I want to find the effect of foreign aid on GDP growth. I plan on first establishing a benchmark that looks like:
GDP=c+human capital+trade+public consumption
I will then add my test variable which is foreign aid:
GDP=c + human capital + trade + public consumption + foreign aid
I want to use 1 and 2 lags for all depen and indepn variables.
I'm confused as to how i should type this in my equation specification and my instrument list.
Please help! Thanks!