Rank condition not verified

[highflyer]

Hi,

I have a quite simple model (see below) that I wanna run on dynare, but there are only 3 eigenvalues larger than 1 for 4 forward-looking variables. How can I solve that problem?

thanks for any hints!




var pi, y, r, u, v, r2, r3;
varexo e;

parameters beta, k, phi_pi, phi_y, phi_v, sigma, lamda;
beta=0.99;
sigma=2;
phi_pi=1.5;
phi_y=0.1;
lamda=0.6;
k=0.02;
phi_v=0.95;

model;
pi=beta*pi(+1)+k*y;
r=phi_pi*pi+phi_y*y+v;
v=phi_v*v(-1)+e;
(1-lamda)*u+y-lamda*y(-1)=0;
r=sigma*(u(+1)-u)+pi(+1);
-sigma*u=r2-sigma*u(+1)-pi(+1)-r(+1);
-sigma*u=r3-sigma*u(+1)-pi(+1)-r2(+1);
end;

initval;
pi=0;
y=0;
r=0;
v=1;
e=0;
u=0;
r2=0;
r3=0;
end;

check;

shocks;
var e; stderr 0.009;
end;

stoch_simul(periods=2000,irf=100);

[jpfeifer]

There must be a problem with your timing.