The rank conditions ISN'T verified!

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The rank conditions ISN'T verified!

Postby jackf118 » Thu Dec 26, 2013 5:07 pm

Dear all,

I add a new country in a two-country cash-in-advance model which I successfully get the result. Yet I find "The rank conditions ISN'T verified!" after the modification. By mistakenly put another similar variable ostar(-1) rather than nspur(-1) in line 39, the condition was met. That does not make much sense to me. Can anyone help me figure out the reason why such error occurs? Please see the attached mod file. Many thanks!


There are 8 eigenvalue(s) larger than 1 in modulus
for 6 forward-looking variable(s)

The rank conditions ISN'T verified!

dynare:k_order_perturbation: Caught Kord exception: NaN or Inf asserted in first order derivatives in FirstOrder::solve
Error using mexErrCheck (line 41)
Error encountered in: k_order_perturbation.

Error in k_order_pert (line 40)
mexErrCheck('k_order_perturbation', err);

Error in stochastic_solvers (line 65)
[dr,info] = k_order_pert(dr,M_,options_,oo_);

Error in resol (line 118)
[dr,info] = stochastic_solvers(dr,check_flag,M,options,oo);

Error in stoch_simul (line 76)
[oo_.dr,info,M_,options_,oo_] = resol(0,M_,options_,oo_);

Error in issuemoney (line 231)
info = stoch_simul(var_list_);

Error in dynare (line 120)
evalin('base',fname) ;
Attachments
issuemoney.mod
(2.55 KiB) Downloaded 165 times
jackf118
 
Posts: 11
Joined: Wed Jun 20, 2012 2:18 am

Re: The rank conditions ISN'T verified!

Postby jpfeifer » Fri Dec 27, 2013 8:52 am

As model_diagnostics says:

model_diagnostic: the Jacobian of the static model is singular
there is 2 colinear relationships between the variables and the equations
Relation 1
Colinear variables:
px
c
m
p
numda
numdastar
bstar
CA
nstar
n
nbar
netdebt
cstar
cspur
im
imspur
nspur
espur
obar
ostar
ospur
debtgdp
Relation 2
Colinear variables:
px
c
m
p
numda
numdastar
bstar
CA
nstar
n
nbar
netdebt
cstar
cspur
im
imspur
nspur
espur
obar
ostar
ospur
debtgdp
Relation 1
Colinear equations
2

Relation 2
Colinear equations
1 2 5

The presence of a singularity problem typically indicates that there is one
redundant equation entered in the model block, while another non-redundant equation
is missing. The problem often derives from Walras Law.
------------
Johannes Pfeifer
University of Cologne
https://sites.google.com/site/pfeiferecon/
jpfeifer
 
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Location: Cologne, Germany

Re: The rank conditions ISN'T verified!

Postby jackf118 » Fri Dec 27, 2013 9:03 am

Thanks you so much! I will check it.
jackf118
 
Posts: 11
Joined: Wed Jun 20, 2012 2:18 am


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