Dynare forums

Hi friends,
When I run my model, appear these errors:

There are 6 eigenvalue(s) larger than 1 in modulus
for 0 forward-looking variable(s)

The rank condition ISN'T verified!

Warning: Matrix is close to singular or badly scaled. Results may
be inaccurate. RCOND = 9.042111e-19.
> In stochastic_solvers at 188
In resol at 113
In stoch_simul at 80
In qwe at 500
In dynare at 162
Warning: Matrix is close to singular or badly scaled. Results may
be inaccurate. RCOND = 9.042111e-19.
> In stochastic_solvers at 190
In resol at 113
In stoch_simul at 80
In qwe at 500
In dynare at 162
Error using print_info (line 42)
Blanchard Kahn conditions are not satisfied: no stable
equilibrium

Error in stoch_simul (line 85)
print_info(info, options_.noprint, options_);

Error in qwe (line 500)
info = stoch_simul(var_list_);

Error in dynare (line 162)
evalin('base',fname) ;

please help me to solve these errors.
Thanks a lot.

There are a number of problem with your code.

1) The rank condition is not satisfied ie There are 6 eigenvalue(s) larger than 1 in modulus
for 0 forward-looking variable(s). Also see the manual and viewtopic.php?f=1&t=3325

2) There could be colinear variables meaning there is a redundant equation and one missing one. This is due to Walras Law. Check your market clearing conditions, one of the equations could be redundant. Also see viewtopic.php?f=1&t=3560

The trick is to start from a very small model by shutting down a number of equations and try if the code runs. If it does't fix the error then run the code again and again until it runs. Once it runs, then add one equation at time.

The smaller the model, the easier it is to identify the problem then you build from there.

Best