Dynare forums

Can anyone tell me that what should I do when it shows that

EIGENVALUES:
Modulus Real Imaginary

0.95 0.95 0
1.005 1.002 0.08288
1.005 1.002 -0.08288
Inf Inf 0


There are 3 eigenvalue(s) larger than 1 in modulus
for 2 forward-looking variable(s)

The rank conditions ISN'T verified!


How can I do in order to meet the rank condition?

Thank you very much

Hi,

You should (in this order):

1. Check your steady state.
2. Check that the timing of the variables of your model is correct.
3. Check your model.
4. Change your model...

This is what I do when I have this kind of problem.

Best, Stéphane.

You could make additional action:
V Check parameters values

It is often that wrong coefficient at government policy leads to rank condition problems.

Thank you very much for your helps