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Dear All:
I am new to Dynare.How to get picture of IRF to 1% decrease in total prodctivity ?
The total prodctivity follows a function:lnA(t)=rho*ln(A(t-1))+epsilon(t)
May I use command as follows:
shocks;
var e;
stderr 0.01;
end;
stoch_simul;

Thank you very much!

Dear Wanghao,

I think you can use that,but I noticed 2 things. If I understand it correctly epsilon is exogenous variable, so shocks block should go like this:

shocks;
var epsilon;
stderr 0.01;
end;
stoch_simul;

Secondly, in order to have decrease of 1 percent you should have - instead of + infront of epsilon in total productivity function.

Best

Dear Nini:
Thank you very much for your comment.Yes,epsilon is exogenous variable and I just use e for convenience.And thank you for correction for - instead of + infront of epsilon in total productivity function.

Best wishes