1. Cross Equation Constraints

2. Stone-Geary Utility Function Linear expenditure system
U= (q1 - 1) (q2 - 2)
 + =1
 and  are expenditure shares (above subsistence)
i subsistence quantity of good I

3. Stone-Geary Utility Function
q1 = 1 + (/p1)(M - p11 - p22)
M is money income
pi is price of good i
q2 = 2 + (/p2)(M - p11 - p22)

4. Stone-Geary Utility Function
q1 = 1 (1- )+ (M/p1)- (p2 /p1)  2
q1 = a0 + a1 (M/p1) + a2 (p2 /p1) + 1
q2 = 2  + (M/p2)- (p1 /p2)  1
q2 = b0 + b1 (M/p2) + b2 (p1 /p2) + 2

5. Stone-Geary Utility Function
Constraints
a1 + b1 = 1
a2 = b0
a0 = b2
q1 = a0 + a1 (M/p1) + a2 (p2 /p1) + 1
q2 = b0 + b1 (M/p2) + b2 (p1 /p2) + 2

6. Constraints in Stata Constraint define # “condition” example 1:
constraint define 1 var1=var2
coefficient on var1 equals coefficient on var2
example 2:
constraint define 2 [q1]constant = [q2]var3
constant in q1 equation equals coefficient on var3 in q2 equation

7. Seemingly Unrelated Regressions in Stata
SUREG ([eqname1]: depvar1 indvar11 indvar12…, noconstant) ([eqname2]: depvar2 indvar21 indvar22…, noconstant), constraint(constraint numbers)
eqname is optional
noconstant is optional
constraint(.) is optional

8. Seemingly Unrelated Regressions in Stata
SUREG ([q1]: q1 M/p1 p2/1) ([q2]: q2 M/p2 p1/2)
test [q1]constant = [q2] p1/2
constraint define 2 [q1]constant=[q2] p1/2
SUREG ([q1]: q1 M/p1 p2/1) ([q2]: q2 M/p2 p1/2), constraint(2)