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Everything about Reduced form

Results from a system of equations in econometrics

In statistics, and particularly in econometrics, the reduced form of a system of equations is the result of solving the system for the endogenous variables. This gives the latter as functions of the exogenous variables, if any. In econometrics, the equations of a structural form model are estimated in their theoretically given form, while an alternative approach to estimation is to first solve the theoretical equations for the endogenous variables to obtain reduced form equations, and then to estimate the reduced form equations. Wikipedia →

🧭 Start here: a 6-step reading path

  1. Read the overview: Reduced formA 5-minute orientation
  2. Skim a recent paper: β-Variational autoencoders and transformers for reduced-order modelling of fluid flowsInfluential work since 2022
  3. Pick up a classic book: Throne und KlinenThe most-reprinted book on the subject
  4. Read the landmark paper: Wage Discrimination: Reduced Form and Structural EstimatesCited 4,823 times
  5. Go sideways: Simultaneous equations modelA closely related topic
  6. Go sideways: Errors-in-variables modelA closely related topic

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