Hello !
 
I’m trying to estimate a system of equation (demand and supply) using the systemfit package.  My program is:
 
library(systemfit)
demand <- tsyud ~ tsyud1 + tsucp + tspo + tssn
supply <- tscn ~ tsyn + tsqn + tsksn + tsucp
system <- list(demand=eqdemand, learning = eqsupply)
labels <- list(demand="eqdemand", learning="eqsupply")
inst <- ~ tsupp1 + tsupp2 +
tsupp3 + tsyus1 + tsupf + tsd1 + tsyud1 + tspo + tssn + tsupp + tsus +
tsus1 + tsyn + tsqn + tsksn
result2sls <-systemfit(method="2SLS", system, labels, inst=inst)
 
 
This does not work and I have the following error message that I do not understand its meaning:
 
Error in solve(crossprod(zMatEq[[i]]), crossprod(zMatEq[[i]], xMatAllThisEq),  : 
  the leading minor of order 3 is not positive definite
 
Can you help me please to understand the problem?
 
 Remark1: Please note that in my estimation, the variables tsyud1, tsupp1, tsupp2, tsupp3, and tsyus1 are lagged variables.
 
Remark2: When I try to estimate each one of my two equations separately using the sem package, I also have an error message: 
 
supplyreg <- tsls(tscn ~ tsyn + tsqn + tsksn + tsucp, ~ tsupp1 + tsupp2 +
tsupp3 + tsyus1 + tsupf + tsd1 + tsyud1 + tspo + tssn + tsupp + tsus +
tsus1 + tsyn + tsqn + tsksn)
summary(supplyreg)
 
Error in solve.default(crossprod(Z))"Lapack routine dgesv: system is exactly singular"
 
Do the two error messages mean the same think?
 
Thank you in advance for your help.


      
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