close all

% 1. defining variables and parameters.

var x inflation R;

varobs x inflation R;

varexo epsx epsinf epsR;

parameters beta delta alpha phi kappa rhoinf rhox sigepsx sigepsinf sigepsR;

beta=0.99;

% 2. defining the model.

model(linear);
        x   = (1-delta)*x(-1)+ delta*x(+1)-phi*(R-inflation(+1))+epsx;
  inflation = (1-alpha)*inflation(-1)+ alpha*inflation(+1)+kappa*x+epsinf;
          R = rhoinf*inflation+rhox*x+epsR;
end; 

% 3. defining parameter's bounds and priors

estimated_params;

delta, beta_pdf,0.40,0.10;
alpha, beta_pdf,0.65,0.10;
phi, gamma_pdf,0.24,0.10;
kappa, gamma_pdf,0.13,0.05;
rhoinf, normal_pdf,1.50,0.20;
rhox, normal_pdf,0.50,0.15; 
stderr epsx, inv_gamma_pdf,0.46,2;
stderr epsinf, inv_gamma_pdf,1.09,2;
stderr epsR, inv_gamma_pdf,0.49,2;
end;

%4. Running estimation et specifing data file

estimation(datafile=data84S1,mh_replic=20000,mh_nblocks=5,mh_drop=0.5,mh_jscale=0.2,moments_varendo,bayesian_irf) x inflation R;