Identification Status of the Model for the Fulfillment of Assumption 6:

In order to check identification status of the model, it is compulsory that model should be
complete. Concept of identification is mainly related to the estimation of simultaneous model.
Parameters of any equation can be identified if it has a unique statistical form. Identification can be
checked by examining structural form of the model as well as reduced form. Originally, the term
identification was referred to deduce parameters of the structural model given the knowledge of
reduced form parameters. However, examination via reduced form approach is computationally
difficult than the structural model form approach. An equation is said to be unidentified if it has not
a unique statistical form. An identified equation can be classified into two categories:
1. Exact Identified Equation
2. Over Identified Equation