Abstract
In Don and Gallo (1987) it was argued that a large sparse system of equations can be solved efficiently if the equations are ordered in such a way that the set of feedback variables is small. Also an algorithm to find such an ordering was presented. In this paper we discuss some complications that may arise in applying these techniques. The issues considered have come up in applied econometric models and relate to nonnormalized equations, implicit equations, and vector equations. It is argued that a good normalization does not always exist (even if a bad one does). We discuss how implicit equations, whether single noninvertible equations or system equilibrium conditions, can be handled. Finally it is shown that vector equations pose no real problem if they are appropriately represented in the structural graph.
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