Adding a net worth shock and uncertainty shock to GK (2011)

[Basse]

Dear users,

I hope you can help me with the following problem. I want to add a net worth shock including an uncertainty shock to Gertler & Karadi's: A model of unconventional monetary policy (2011).

I have incorporated the two shocks as follows:
shock_n = rho_shock_n*shock_n(-1)+shock_sig*e_n
shock_sig = rho_shock_sig*shock_sig(-1)+e_sig

I have thus added exp(shock_n) to the total net worth equation (11).

But I get the message:
ERROR: NWS.mod:194.1-9: syntax error, unexpected NAME

Which I understand is an error in the specified shock_n. But I cannot figure out how to solve this, and get the code running. I have attached the code, if you care to take a look.

NWS.mod

Dynare .mod file for the expanded GK model

(9.23 KiB) Downloaded 96 times

I would truly appreciate any help!
Kindest regards,

[donihue]

It is simple: you omitted a ";" at the end of the statements for "shock_n" and "shock_sig".

However, the model does not work: "Impossible to find the steady state" because
"model diagnostic can't obtain the steady state
model_diagnostic: the Jacobian of the static model is singular
there is 1 colinear relationships between the variables and the equations
Colinear variables:
nu
Colinear equations
Columns 1 through 18
1 2 3 4 5 6 7 8 10 11 12 13 14 15 16 17 18 19
Columns 19 through 36
20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 43"

Regards
Donihue

[Basse]

Thank you so much for your help Donihue!

I got the model running by also adding exp to the "shock_n" variable.

NWS.mod

Corrected .mod file

(9.41 KiB) Downloaded 124 times

I wonder though, how it is possible to incorporate two shocks at a time, such that my uncertainty shock "shock_sig" can work through the net worth shock "shock_n". I want to do this, to analyze the effect of increased uncertainty regarding a potential drop in the net worth of the financial sector.
Or is it possible to incorporate the uncertainty shock, even though the net worth shock is zero?

Does anyone have an idea for this? Any suggestions are highly appreciated.

Best regards