SW2007 flexible economy

This forum is closed. You can read the posts but cannot write. We have migrated the forum to a new location where you will have to reset your password.
Forum rules
This forum is closed. You can read the posts but cannot write. We have migrated the forum to a new location (https://forum.dynare.org) where you will have to reset your password.

SW2007 flexible economy

Postby h0ps » Wed Aug 01, 2012 8:42 am

Hi guys, hope you can help me out on this one.

In the SW2007 model code how come that 1) there is no inflation equation and 2) why is the realwage formulated as it is?

Code: Select all
// flexible economy

         0*(1-calfa)*a + 1*a =  calfa*rkf+(1-calfa)*(wf)  ;
         zcapf =  (1/(czcap/(1-czcap)))* rkf  ;
         rkf =  (wf)+labf-kf ;
         kf =  kpf(-1)+zcapf ;
         invef = (1/(1+cbetabar*cgamma))* (  invef(-1) + cbetabar*cgamma*invef(1)+(1/(cgamma^2*csadjcost))*pkf ) +qs ;
                      pkf = -rrf-0*b+(1/((1-chabb/cgamma)/(csigma*(1+chabb/cgamma))))*b +(crk/(crk+(1-ctou)))*rkf(1) +  ((1-ctou)/(crk+(1-ctou)))*pkf(1) ;
         cf = (chabb/cgamma)/(1+chabb/cgamma)*cf(-1) + (1/(1+chabb/cgamma))*cf(+1) +((csigma-1)*cwhlc/(csigma*(1+chabb/cgamma)))*(labf-labf(+1)) - (1-chabb/cgamma)/(csigma*(1+chabb/cgamma))*(rrf+0*b) + b ;
         yf = ccy*cf+ciy*invef+g  +  crkky*zcapf ;
         yf = cfc*( calfa*kf+(1-calfa)*labf +a );
         wf = csigl*labf    +(1/(1-chabb/cgamma))*cf - (chabb/cgamma)/(1-chabb/cgamma)*cf(-1) ;
         kpf =  (1-cikbar)*kpf(-1)+(cikbar)*invef + (cikbar)*(cgamma^2*csadjcost)*qs ;

// sticky price - wage economy

         mc =  calfa*rk+(1-calfa)*(w) - 1*a - 0*(1-calfa)*a ;
         zcap =  (1/(czcap/(1-czcap)))* rk ;
         rk =  w+lab-k ;
         k =  kp(-1)+zcap ;
         inve = (1/(1+cbetabar*cgamma))* (  inve(-1) + cbetabar*cgamma*inve(1)+(1/(cgamma^2*csadjcost))*pk ) +qs ;
                      pk = -r+pinf(1)-0*b +(1/((1-chabb/cgamma)/(csigma*(1+chabb/cgamma))))*b + (crk/(crk+(1-ctou)))*rk(1) +  ((1-ctou)/(crk+(1-ctou)))*pk(1) ;
         c = (chabb/cgamma)/(1+chabb/cgamma)*c(-1) + (1/(1+chabb/cgamma))*c(+1) +((csigma-1)*cwhlc/(csigma*(1+chabb/cgamma)))*(lab-lab(+1)) - (1-chabb/cgamma)/(csigma*(1+chabb/cgamma))*(r-pinf(+1) + 0*b) +b ;
         y = ccy*c+ciy*inve+g  +  1*crkky*zcap ;
         y = cfc*( calfa*k+(1-calfa)*lab +a );
         pinf =  (1/(1+cbetabar*cgamma*cindp)) * ( cbetabar*cgamma*pinf(1) +cindp*pinf(-1)
                      +((1-cprobp)*(1-cbetabar*cgamma*cprobp)/cprobp)/((cfc-1)*curvp+1)*(mc)  )  + spinf ;
         w =  (1/(1+cbetabar*cgamma))*w(-1)
               +(cbetabar*cgamma/(1+cbetabar*cgamma))*w(1)
               +(cindw/(1+cbetabar*cgamma))*pinf(-1)
               -(1+cbetabar*cgamma*cindw)/(1+cbetabar*cgamma)*pinf
               +(cbetabar*cgamma)/(1+cbetabar*cgamma)*pinf(1)
               +(1-cprobw)*(1-cbetabar*cgamma*cprobw)/((1+cbetabar*cgamma)*cprobw)*(1/((clandaw-1)*curvw+1))*
               (csigl*lab + (1/(1-chabb/cgamma))*c - ((chabb/cgamma)/(1-chabb/cgamma))*c(-1) -w)
               + 1*sw ;
         r =  crpi*(1-crr)*pinf
               +cry*(1-crr)*(y-yf)     
               +crdy*(y-yf-y(-1)+yf(-1))
               +crr*r(-1)
               +ms  ;
         a = crhoa*a(-1)  + ea;
         b = crhob*b(-1) + eb;
         g = crhog*(g(-1)) + eg + cgy*ea;
         qs = crhoqs*qs(-1) + eqs;
         ms = crhoms*ms(-1) + em;
         spinf = crhopinf*spinf(-1) + epinfma - cmap*epinfma(-1);
             epinfma=epinf;
         sw = crhow*sw(-1) + ewma - cmaw*ewma(-1) ;
             ewma=ew;
         kp =  (1-cikbar)*kp(-1)+cikbar*inve + cikbar*cgamma^2*csadjcost*qs ;
h0ps
 
Posts: 32
Joined: Tue Jul 10, 2012 1:55 pm

Re: SW2007 flexible economy

Postby nec_spe » Sat Aug 04, 2012 4:23 pm

1) there is no inflation equation
There is (pinf=price inflation)
2) why is the realwage formulated as it is?
It is defined as usual (W/P)
nec_spe
 
Posts: 6
Joined: Wed Jul 11, 2012 2:42 pm


Return to Dynare help

Who is online

Users browsing this forum: No registered users and 5 guests