Dear all,

As far as I know, in case of estimation, number of shocks must be at least equal to the number of observable variables.

My question is that what if we have a deterministic model and want to estimate it, as in this kind of models we might have several shocks to the same variable during a period of time, would this number of shocks for the same variable be considered as just one shock or can be applied for the number of the observable variables as well ?!

I mean if let say we have 10 shocks to the same variable during the time can I take 10 observable variables or I should take just one?!

I know using a deterministic model even for the simulation purposes is not that common and it might get more complicated in case of estimation but I would appreciate any help.

Thanks.