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Posterior IRF of a system growing with technology

PostPosted: Sun Jan 20, 2013 7:30 am
by wanghao19820707
Dear All,
I want to get Posterior IRF of a system growing with technology.In the equation system,output,investment is trasformed to stationary variable according to dynare request.But I want to get Posterior IRF for output,investment which grows with technology(that are,real output and investment).what should I do ?
Attached file is my mod file and data file.

Thank you!

Re: Posterior IRF of a system growing with technology

PostPosted: Mon Jan 28, 2013 5:39 pm
by jpfeifer
If you estimated the model in first differences, you have to integrate the series up (i.e. add up the changes) the variables after a permanent technology shock. You have to program this yourself. For example, let X_t be the trend in labor-augmenting technology and define y_t=Y_t/X_t. Then obviously Y_t=y_t*X_t. From the estimated model, you have y_t (the detrended one) and the response of Delta X_t. Starting with X_0=1, it is easy to back out the IRF of y_t.

Re: Posterior IRF of a system growing with technology

PostPosted: Tue Jan 29, 2013 1:58 am
by wanghao19820707
Dear jpfeifer:
Thank you very much! I will try