Question: Explain the order condition. Use the order condition to show that the Y2equation is exactly identified and the Y1equation is not identified. Y1=a+bY2+cX1+u1 Y2=d+eY1+u2

Explain the order condition. Use the order condition to show that the Y2equation is exactly identified and the Y1equation is not identified.

Y1=a+bY2+cX1+u1

Y2=d+eY1+u2

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