New Keynesian model steady state

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New Keynesian model steady state

Postby flyaway1234 » Tue Jul 01, 2014 1:48 pm

hello,
I'm trying to run a New Keynesian model which has a banking sector in Dynare.But the result show the error like this:

"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"
I have already compute the steady state analytically using pencil and paper.I'm a new user of Dynare,I can not find the problem.Can someone help me and tell me what I'm doing wrong?
I have already uploaded the file,many thanks in advance.
Attachments
NKmodel.mod
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Re: New Keynesian model steady state

Postby jpfeifer » Tue Jul 01, 2014 3:35 pm

Given your supposed steady state values, the residuals of your equations when using resid(1) before steady are
Residuals of the static equations:

Equation number 1 : 0
Equation number 2 : -0.84443
Equation number 3 : 0
Equation number 4 : -181.969
Equation number 5 : 0
Equation number 6 : -0.65022
Equation number 7 : 0
Equation number 8 : 0
Equation number 9 : -1043.0063
Equation number 10 : 0
Equation number 11 : 0
Equation number 12 : 0
Equation number 13 : 0
Equation number 14 : 0
Equation number 15 : 0
Equation number 16 : 0
Equation number 17 : 0
Equation number 18 : 0
Equation number 19 : 0
Equation number 20 : 3.2062
Equation number 21 : 0
Equation number 22 : 0
Equation number 23 : 0
Equation number 24 : 0
Equation number 25 : 0
Equation number 26 : 0
Equation number 27 : -2.3271
Equation number 28 : 0
Equation number 29 : 0
Equation number 30 : 0
Equation number 31 : 0
Equation number 32 : 0
Equation number 33 : 0
Equation number 34 : 0


Hence, either your steady state values are wrong or there is still a mistake in those equations.
------------
Johannes Pfeifer
University of Cologne
https://sites.google.com/site/pfeiferecon/
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Location: Cologne, Germany


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