Note on Anderson’s “Causal Models in Educational Research: Nonrecursive Models”

Two comments are made concerning Anderson’s article (1978) on the identification and estimation of nonrecursive models. First, Anderson’s rule for identification is only a necessary but not sufficient condition. The necessary and sufficient conditions are presented using matrix notation and a modified version of Anderson’s rule is offered. Second, contrary to Anderson’s discussion, the choice of two-stage or ordinary least squares depends on the data results rather than the methodological properties of the estimators. A means for choosing between the estimates is provided.