Dynare forums

Dear all

I am a new user of Dynare and I have a question (maybe somewhat trivial for some of you): how to compute negative stochastic shocks ? More precisely, I would like to compute, within a DSGE model, the impact of a decrease in the total factor productivity.

Thanks in advance.

Just make sure the shock in your mod file enters with a negative coefficient.
instead of
TFP=ar1*TFP(-1) + iidshock
you write
TFP=ar1*TFP(-1) - iidshock

reuben