Dynare forums

Hello:

I am a Beginner at Dynare and I am being asked to write the non-linearized New Keynesian Model as described in Walsh(2010) in order for Dynare to run log-linearization. I can't find how to express the following equation

pstar_t/P_t = {sum_j(0:inf)[w^i*beta^i*C_t+i^(1-sigma)*phi_t+i*(P_t+i/P_t)^theta] / sum_j(0:inf)[w^i*beta^i*C_t+i^(1-sigma)*(P_t+i/P_t)^(theta-1)]} *(theta/(theta-1))

Where w and beta are parameters in the interval (0,1), sigma is an aversion risk coefficient and theta is a elasticity, where all of them are given values. pstar_t denotes the optimal price set by firms able to do so at period t, P_t is the aggregate price level at time t, C_t is consumption at time t and phi_t is marginal cost at time t. Sum_i(0:inf)[...] denotes the sum, for i gooing from zero to infinity of the expression contained in square brackets. As is notices, there is sigma notation which, as I know, cannot be written down like that in dynare.

Can you please give me indications about how I should input this in dynare?

Thanks for your help.

See http://www.dynare.org/phpBB3/viewtopic.php?f=1&t=4482

Thanks jpfeifer, could you please tell me exactly what is the paper by Schmitt and Uribe in which the authors solve the pricing problem, if you don't mind?

Thanks for your help.

Have a look at:
Optimal Simple and Implementable Monetary and Fiscal Rules: Expanded Version
Stephanie Schmitt-Grohé and Martín Uribe
NBER Working Paper No. 12402
July 2006
http://www.nber.org/papers/w12402

Thank you so much, I really appreciate your help.