*
* Example 9.9
* Nonlinear instrumental variables
* page 183
*
open data tablef5-1[1].txt
calendar(q) 1950
data(format=prn,org=columns) 1950:1 2000:4 year qtr realgdp realcons realinvs realgovt realdpi $
  cpi_u m1 tbilrate unemp pop infl realint
*
nonlin a b g
linreg realcons
# constant realdpi
compute a=%beta(1),b=%beta(2),g=1
*
frml cfrml realcons = a+b*realdpi**g
*
* Set the instrument list. In addition to the variables listed, the CONSTANT is
* almost always included as an instrument.
*
instruments constant realcons{1} realdpi{1 2}
*
* The NLLS uses the option INSTRUMENT to change to non-linear IV from non-linear
* least squares
*
nlls(frml=cfrml,inst) realcons 1950:3 *
*
* Least squares estimated over the same sample as was used in IV.
*
nlls(frml=cfrml) realcons 1950:3 *