*
* KLEIN.RPF
* RATS Version 8, User's Guide, Example from Section 2.5.
* Estimates the equations of Klein's Model I
*
calendar(a) 1920
open data klein.prn
data(format=prn,org=obs) 1920:1 1941:1
table
set wagebill = privwage + govtwage

set capital  = klagged1+invst
set trend    = year-1920

instruments  constant trend govtwage taxes govtexp $
             capital{1} prod{1} profit{1}
linreg(inst)  cons
# constant  profit{0 1}   wagebill
linreg(inst)  invst
# constant  profit{0 1}   capital{1}
linreg(inst)  privwage
# constant  prod{0 1}  trend