Dynare forums

Hi,

I am trying to add small open economy effects on the Gertler and Karadi 2011 model of unconventional policy.

I am still new to Dynare and have been working with the replication files from macromodelbase.com.

I have tried adding the SOE effects in the current file structure, but steady state is not computed and I am having a hard time troubleshooting since I am not 100% sure what happens in the external files. Error message:

Error using print_info (line 55)
The steadystate file did not compute the steady state

Error in check (line 76)
print_info(info, options.noprint);

Error in NK_GK11_rep (line 401)
oo_.dr.eigval = check(M_,options_,oo_);

Error in dynare (line 120)
evalin('base',fname) ;

Hence, I would like help to getting Dynare to calculate the steady state internally i.e. from inside Dynare using no external files (just the .mod). Or, alternatively, help on getting the attached SOE codes right. If I just copy the steady state results from the original replication files as initial values Dynare cannot find steady state. Any suggestions on how to proceed?

Attached are my attempt to incorporate SOE in the current file structure - indented equations in the files are added by me.

Thanks

MS

You need to keep the structure with an external steady state file. But you should move the

Code: Select all

steady

command before the first

Code: Select all

check

to get useful debugging information.

Okay, I will keep the current file structure. Could you perhaps help me understand the reason for this file structure?

I assume that this means Dynare cannot calculate the steady state and that I have to input equations for ss in the steadystate file for my extensions of the model. How should the remaining files be updated when I do this?

Thanks. Appreciate the help.

The Gertler/Karadi model uses a numerical solver to compute the steady state. That's why you shoud keep the steady state file. What you need to do is adjust the equations in the steady state file to provide the steady state for your modified model, i.e. change the model-specific part. Focus on the equations where Dynare shows you that residuals are not 0