%%FINANCIAL INCLUSION WITHOUT DEFAULT%%%%%%%%%%%%%
%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%


var 
c_p           
c_i        
r_d
r_b
pi        
d       
b
n_p
n_i
w_p
w_i       //wages paid by BCAs to rural labor
q_h
h
y
z_e
eps_l
eps_d
eps_b
;

predetermined_variables q_h;

//Exogenous Shocks
varexo e_z_e, e_z_l, e_z_d, e_z_b;

//Model Parameters (including Steady State)

parameters
alph
beta_p
beta_i
s_i
h_bar
pi_s
z_e_bar  
eps_l_bar
eps_d_bar
eps_b_bar
rho_z_e 
rho_l
rho_d
rho_b
;

//Value of Parameter
alph        =       0.5;
s_i         =       0.8;
beta_p      =       0.999;
beta_i      =       0.982;
pi_s        =       1;
z_e_bar      =      3;
eps_l_bar   =       1;
eps_d_bar   =       1;
eps_b_bar   =       1;
s_i         =       0.8;  %LTV ratio urban impatient hhd (80%)
h_bar       =       1;
rho_z_e     =       0.99;
rho_l      =        0.99;
rho_d        =      0.99;
rho_b        =      0.99;


model;
 %%Firms

z_e         =   (1-rho_z_e)*z_e_bar+rho_z_e*(z_e(-1))+e_z_e;                    %Eqn 63
(eps_l)     =   (1-rho_l)*eps_l_bar+rho_l*(eps_l(-1))+e_z_l;           %Eqn 68
(eps_d)     =   (1-rho_d)*eps_d_bar+rho_d*(eps_d(-1))+e_z_d;
(eps_b)     =   (1-rho_b)*eps_b_bar+rho_b*(eps_b(-1))+e_z_b;

    n_p=1;
    n_i=1;
    y=z_e*n_p^(alph)*n_i^(1-alph);
    w_p-alph*z_e*n_p^(alph-1)=0;
    w_i-(1-alph)*z_e*n_i^(-alph)=0;
    c_p=w_p*n_p/eps_l;
    c_i=w_i*n_i/eps_l;
    (1/c_p)=(beta_p*(1+r_d)/(c_p(+1)*pi(+1)))-eps_d;
    d-((1+r_d(-1))/pi)*d(-1)=w_p*n_p-c_p;
    1+r_b=(eps_b-1/c_p)/((beta_i*(1/c_p(+1))*((1/s_i)-1)/pi(+1))-((q_h*(1/c_i))/(s_i*q_h(+1)*pi(+1))));
    (1+r_b(-1))*b(-1)/pi - b = w_i*n_i-q_h*(h-h(-1))-c_i;
    h=h_bar;
    q_h(+1)=((1+r_b)*b)/(s_i*h*pi(+1));
    y=c_p+c_i;
    
    
    
end;

shocks;
var e_z_e;
stderr 1;
var e_z_b;
stderr 1;
var e_z_l;
stderr 1;
var e_z_d;
stderr 1;
end;

initval;
pi              =                   1;
n_p             =                   1;
n_i             =                   1;
z_e             =                   z_e_bar;
eps_l           =                   eps_l_bar;
eps_d           =                   eps_d_bar;
eps_b           =                   eps_b_bar;
y               =                   z_e*n_p^(alph)*n_i^(1-alph);
w_p             =                   alph*z_e;
w_i             =                   (1-alph)*z_e;
c_p             =                   w_p*n_p/eps_l;
c_i             =                   w_i*n_i/eps_l;
r_d             =                   ((1+eps_d*c_p)/beta_p)-1;
d               =                   (1-(1/eps_l))/(1-(1+eps_d*c_p)/pi);
r_b             =                   (eps_b-1/c_p)/((1/c_p)*(((beta_i-1)/s_i)-beta_i));
b               =                   ((1-alph)*z_e*(1-1/eps_l))/r_b;
h               =                   1; 
q_h             =                   (1+r_b)*b/(s_i*h*pi_s);  
y               =                   c_i+c_p;
end;

steady;
%check;

model_diagnostics;

%estimated_params_init;
%end;

stoch_simul (hp_filter=1600, order=1, irf=20, qz_zero_threshold=1e-14);
%estimation(datafile=fin_inclusion2,mh_replic=10000,mh_nblocks=2,mh_drop=0.45);
%options_.plot_priors=0;
%estimation(datafile=fin_inclusion2,mh_replic=20000,mh_nblocks=4,mh_drop=0.45,mh_jscale=0.8,bayesian_irf,irf=20,mode_compute=7) d_r d_u pi c b_e b_u r_ud k_b;