[This paper contains the derivation of the exact finite sample distribution function of the LIML identifiability test statistic associated with an overidentified nondynamic structural equation which contains two endogenous variables. Some of the properties of the moments of this statistic are also investigated.]

Wallace and Hussain (1969) considered the use of an error components regression model in the analysis of time series of cross-sections and developed an estimator of the coefficient vector based on an estimated variance-covariance matrix of error terms. In this paper, we have shown that under the set of assumptions adopted by Wallace and Hussain there are an infinite number of estimators which have the same asymptotic variancecovariance matrix as the Wallace-Hussain estimator and also that it is not possible to choose an estimator on the basis of asymptotic efficiency. We have developed an alternative estimator of the variance-covariance matrix of error terms and have used this estimator in developing a feasible Aitken type estimator for the coefficient vector. We have derived some small sample properties of this estimator and have compared them with those of other estimators of the coefficient vector.

The article is a reply to a comment by the researchers Michael L. Moore and Stephen Buzby on the author's work, published in the July 1, 1972 issue of the journal "The Accounting Review." According to the authors, Moore and Buzby have made several comments on the index of disclosure, which was used in the authors' research to measure the quality of disclosure in annual reports. To test the effectiveness of their index, the authors compared their results with those of the twenty-sixth annual survey by "Financial World." Moore and Buzby noted that the test is somewhat misleading because "Financial World" only punishes the list of award winning companies and the failure of some of the companies in the bottom 23 percent of our sample to win an award may only mean that they were not among the reports surveyed. As mentioned in the authors' article, only 9 of the bottom 23 percent of their sample companies received merit certificates from "Financial World." One of the comments by Moore and Buzby deals with the index's inability to discriminate. This is not true since variable weights were used in scoring annual reports.

Reviews the book "Measurement and Environmental Deterioration," by Boyd Collier.

Finally, for completeness we should note that later work (Harvard Discussion Paper No. 234, 1971) has shown that when investors' risk-aversions are functionally related to their ending wealth, the investor's personal equilibrium depends upon a combination of his risk-aversion and its first derivative, but the market price of risk aggregates the investor's more complex marginal rates of substitution of return and risk in exactly the same way as it aggregates investors risk-aversions per se in simple situations. iMoreover, all the statements made above on the basis of aggregations of risk-aversions are shown to be valid in the more complex analysis.