I have the following model:
Cost of debt = intercept + information quality + control variable1 + control variable2 + … + error term

I want to perform 2sls because I think I could have two situations:
First: maybe information quality is correlated with the error term (because of omitted variables)
Second: maybe information quality depends on the cost of debt like this:
information quality = intercept + Cost of debt + control variable1 + control variable2 + … + error term

I have some variables (instruments) for information quality.
Now I need to know how to use systemfit with this information in each of those situations.

Thank you,
Cecília Carmo,
Portugal

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