Dynare forums

Dear All,
Urgent help required, i get the below error for my model on a small open economy

Warning: Matrix is close to singular or badly scaled. Results may be inaccurate. RCOND =
4.181195e-42.
> In evaluate_steady_state at 85
In resol at 104
In stoch_simul at 88
In ff at 358
In dynare at 180
Error using print_info (line 51)
The Jacobian matrix evaluated at the steady state contains elements that are not real or
are infinite

Error in stoch_simul (line 98)
print_info(info, options_.noprint, options_);

Error in ff (line 358)
info = stoch_simul(var_list_);

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

Why do you say

Code: Select all

model(linear);

when your model is clearly not linear? More importantly, the file you posted is not able to compute the steady state, so I don't get the message you get.

Thanks for the reply. I am new to the modeling did not had a clear idea. Do you have any idea why can't I arrive at steady state when i remove (linear) and just run the model

when i remove linear and run i get below

Residuals of the static equations:

Equation number 1 : -0.66575
Equation number 2 : -4.5533e-06
Equation number 3 : 0
Equation number 4 : 0
Equation number 5 : -0.055122
Equation number 6 : 0
Equation number 7 : 5.2715e-06
Equation number 8 : 0.056817
Equation number 9 : -1.562
Equation number 10 : -0.10805
Equation number 11 : 0.00056316
Equation number 12 : 0.016749
Equation number 13 : 0
Equation number 14 : 0
Equation number 15 : 0
Equation number 16 : 0
Equation number 17 : -8.0805e-07


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

You need to check your model equations and provide better starting values for steady state finding. Concentrate on the equations with big residuals.

I simplified my model and I am getting a new error now. I have attached the new model and I had tried range of initvalues for "l" and getting same error massage. Hope you can advice on this.
STEADY: The Jacobian contains Inf or NaN. The problem arises from:

STEADY: Derivative of Equation 5 with respect to Variable l (initial value of l: 0.1)

STEADY: The problem most often occurs, because a variable with
STEADY: exponent smaller than 1 has been initialized to 0. Taking the derivative
STEADY: and evaluating it at the steady state then results in a division by 0.
Error using dynare_solve (line 60)
An element of the Jacobian is not finite or NaN

Error in evaluate_steady_state (line 66)
[ys,check] = dynare_solve([M.fname '_static'],...

Error in steady_ (line 54)
[steady_state,params,info] =
evaluate_steady_state(oo_.steady_state,M_,options_,oo_,~options_.steadystate.nocheck);
Error in steady (line 81)
[steady_state,M_.params,info] = steady_(M_,options_,oo_);

Error in hh (line 198)
steady;

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

That's because you have

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a_p(+1)*l(+1)

where a_p is an exogenous variable with steady state 0. Because of this, the whole expression is 0. I guess you are missing an exp() around a_p here.

Thanx for the advice, I had corrected that but still it results in below error, Hope you can advice on that as well. I have attached amended mod file as well. Really appreciate your help.
An infinite element was encountered when trying to solve equation(s) 7
with respect to the variable(s): w.
The values of the endogenous variables when the problem was encountered were:
v 0.8
c 1.9
b 0.7
l 1
m 0.4
w 0.8
p 0.2
b_b 0.9
h 0.2

Error using lnsrch1 (line 71)
Some element of Newton direction isn't finite. Jacobian maybe singular or there is a
problem with initial values

Error in solve1 (line 107)
[x,f,fvec,check]=lnsrch1(xold,fold,g,p,stpmax,func,j1,j2,varargin{:});

Error in dynare_solve (line 150)
[x,info]=solve1(func,x,j1(r(i):r(i+1)-1),j2(r(i):r(i+1)-1),jacobian_flag, ...

Error in evaluate_steady_state (line 66)
[ys,check] = dynare_solve([M.fname '_static'],...

Error in steady_ (line 54)
[steady_state,params,info] =
evaluate_steady_state(oo_.steady_state,M_,options_,oo_,~options_.steadystate.nocheck);
Error in steady (line 81)
[steady_state,M_.params,info] = steady_(M_,options_,oo_);

Error in hh (line 198)
steady;

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