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SOE DSGE HELP!!

PostPosted: Wed Dec 16, 2015 1:56 pm
by roara
Hi DSGE solvers

I'm trying make SOE DSGE model. But, I cannot solve NaN/Inf problem..
I need your advice that how can I fix this.

thank you,,

Re: SOE DSGE HELP!!

PostPosted: Thu Dec 17, 2015 9:23 am
by jpfeifer
Please try a calibrated version of the model first. See Remark 2 (Using stoch_simul before Estimation) in Pfeifer(2013): "A Guide to Specifying Observation Equations for the Estimation of DSGE Models" https://sites.google.com/site/pfeiferecon/Pfeifer_2013_Observation_Equations.pdf.
Focus on equation 17 and the model-local variables involved in it. If I understand it correctly, you have

Code: Select all
#rsss=1/(ebs*beta);
#rlss=(rsss*ebs)/ebbarl;

But ebs is an exogenous variable that is mean 0, so you are dividing by 0 and rsss will be infinity. rlss then has infinity divided by infinity, resulting in NaN

Re: SOE DSGE HELP!!

PostPosted: Wed Dec 23, 2015 5:52 am
by roara
Thank you very much, Proffessor !

I made a easy mistake. And, fixed this.
But, I have new problem that colinear variables/equations.

I read much Q's in this forum, but I don't get it well.
How can I fix this problem for example?


many thanks,

Re: SOE DSGE HELP!!

PostPosted: Wed Dec 23, 2015 9:44 am
by jpfeifer
That is hard to tell. Usually, there is one equation missing that needs to replace one of the redundant equations entered in the mod-file. Alternatively, there may still be a (timing) error in your model equations.

Re: SOE DSGE HELP!!

PostPosted: Wed Dec 23, 2015 11:24 am
by roara
Thank you for your quick reply!
I try to revise my equations.
Best wishes,

Roara