Abstract

The paper considers a system of bi-linear responses having a regression structure with known predetermined variables. In econometric studies, the model is widely used and is known as simultaneous equation model. The probability distribution for the coefficients of the exogenous variables as well as that of the error variances along with the marginal likelihood function of the coefficients of the endogenous variables have been derived. The model in this paper has been analysed in the framework of a conditional structural model (Fraser 1968, 1979), which provides the basis of inference about all the parameters.

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