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Hi again,

I am trying to make an estimation using the MH algorithm and I was wondering if you can help as I have encountered some errors.
Based on the model of De Graeve (2008), I used data for the US economy.

Can you please help me to fix these type of errors? I have used the same calibration as in his working paper.
Here I attached the .mod file and the data used. I am very curious to make it work!

Thank you!

Please, can you help me? I really want to understand the mechanism and I cannot figure out how can I solve those errors.

I would really appreaciate your help!

1. You are using the loglinear option. This will take the log of the data unless you use the logdata option (only available in the unstable version).
2. You have 7 observables, but only 6 shocks with non-zero standard deviation. You must have at least 7, i.e. as many shocks as observables to prevent stochastic singularity.
3. You priors are incompatible with the model. E.g.

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KbarNbar, uniform_pdf, 0, 5; 

i.e. the capital-labor ratio has mean 0 and can be negative. That is wrong. Make sure the model runs with calibrated values (which it currently does not due to Blanchard-Kahn violations) and then use

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estimated_params_init(use_calibration);
end;