Overview: SIMLIN Procedure

The SIMLIN procedure reads the coefficients for a set of linear structural equations, which are usually produced by the SYSLIN procedure. PROC SIMLIN then computes the reduced form and, if input data are given, uses the reduced form equations to generate predicted values. PROC SIMLIN is especially useful when dealing with sets of structural difference equations. The SIMLIN procedure can perform simulation or forecasting of the endogenous variables.

The SIMLIN procedure can be applied only to models that are:

• linear with respect to the parameters

• linear with respect to the variables

• square (as many equations as endogenous variables)

• nonsingular (the coefficients of the endogenous variables form an invertible matrix)