Dynare forums

Hello,

I'm trying to run a my model.
Every time I run the model I get the following error message:

Error using print_info (line 74)
Impossible to find the steady state. Either the model doesn't have a steady state, there
are an infinity of steady states, or the guess values are too far from the solution

Error in steady (line 92)
print_info(info,options_.noprint, options_);

Error in taxmodel_2 (line 187)
steady;

Error in dynare (line 180)
evalin('base',fname) ;

I cannot find where my error is.

I am certain that there is a mistake in my model, is there a way of identifying where it is?

attatched .mod file.

Any additional help would be much appreciated.

Thanks

First, the usual advice. Try computing the steady state analytically and get rid of the exp()-substitution until the model solves
Second, I think your Euler equation looks weird. You have both the interest (1+r) in there as well as the return to capital ((ALFA)*exp(k)^(ALFA-1)*exp(n)^(1-ALFA)), thus having the return twice. Correcting this and increasing maxit in the steady command results in a steady state.

I really appreciate to you.

Thank you very much.