Small 2-country model - problem with the 2nd order approxima
Posted:
Thu Jan 27, 2011 10:25 amby rafal.raciborski
Hi,
We have a small 2-country open economy model, which we need to solve with the 2nd order approximation (see the files attached). The 1st order approximation works just fine (it seems), but the 2nd order one does not accomplish. Any suggestion on what's going on?
Thanks in advance for any hint.
Best,
Rafal
Re: Small 2-country model - problem with the 2nd order approxima
Posted:
Thu Jan 27, 2011 12:21 pmby jpfeifer
Could you specify what the problem is?
Note that for second order approximations, you might need to enable pruning to get finite simulated moments:
- Code: Select all
stoch_simul(periods=2000,order=2,irf=0,pruning);
Re: Small 2-country model - problem with the 2nd order approxima
Posted:
Thu Jan 27, 2011 1:40 pmby rafal.raciborski
Thanks. The problem was indeed to get finite simulated moments with the 2nd order approximation. Actually it was not as simple as you suggested:
- Code: Select all
stoch_simul(periods=2000,order=2,irf=0,pruning);
does NOT work (Dynare v. 4.1.3). But we took the hint and followed the instructions in:
http://www.dynare.org/phpBB3/viewtopic.php?f=2&t=2392It appears to work now. Thanks again.
Re: Small 2-country model - problem with the 2nd order approxima
Posted:
Thu Jan 27, 2011 3:04 pmby jpfeifer
Sorry, but if you use the current Dynare snapshot (which I did), pruning is already implemented.