%preamble
%endogeneous variables
var l a yc y;

%exogeneous variables
varexo e;

%parameters and values
parameters alpha beta rho gamma phi x s;
alpha = 0.6;
beta = 0.4;
rho = 2;
gamma = 0.6;
phi = 0.7;
x = 1000;
s = 0.1;


%model
model;

yc = (x*a)^(1-alpha)*l^(alpha-1);
y = (x*a)^(1-alpha)*l^alpha;
a = s*l^(beta+1)*x^(-beta)*a(-1)^phi + e;
l=(gamma/rho)*yc*l(-1);
end;

initval;
l=16;
a=0.8;
end;

steady;

shocks;
var e;
periods 30;
values 1;
end;

steady;

stoch_simul(hp_filter=1600, order=1, irf=40);