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problem with second-order approximation

PostPosted: Wed Mar 04, 2015 1:01 pm
by ahuca2008
Dear all,
I want to solve a linear DSGE model with a second-order approximation ,but I don't know how to do it in dynare.should I use the code"stoch_simul(order=2)"?When I use the second-order approximation, the model must be non-linear?

Thanks you for your time.

Re: problem with second-order approximation

PostPosted: Wed Mar 04, 2015 2:00 pm
by jpfeifer
Exactly, you use orer=2 and you have to enter the model nonlinearly. If you enter it linearly, there is no point in going to second order.

Re: problem with second-order approximation

PostPosted: Wed Mar 04, 2015 4:35 pm
by ahuca2008
Dear jpfeifer,
Thanks for your helping.When I use a second-order approximation to solve the model , where should the model solution be store in dynare? In this case , should the solution equal to the model steady state value?

Re: problem with second-order approximation

PostPosted: Thu Mar 05, 2015 10:32 am
by jpfeifer
Depends on what you are looking for. The saving of results is documented in the manual.