I open a new topic to see if someone can help me with the collinearity problem I have in my model based on GNSS "Credit and banking in a DSGE model of the Euro Area". According to model_diagnostics equations 32, 33, 34 and 64 are colinear. Could anyone help me with that please? For the moment I wasn't able to fix it.
Any idea will be helpful!!
MODEL_DIAGNOSTICS: The Jacobian of the static model is singular
MODEL_DIAGNOSTICS: there is 3 colinear relationships between the variables and the equations
Relation 1
Colinear variables:
c_p
h_p
d_p
l_p
lam_p
J_R
j_B
pie_wp
c_i
h_i
b_i
l_i
lam_i
s_i
pie_wi
I
c_e
k_e
l_pd
l_id
b_ee
y_e
lam_e
s_e
u
d_b
b_h
b_e
r_d
r_bh
r_be
R_b
K_b
pie
x
C
Y
D
BE
BH
B
w_p
w_i
q_h
K
PIW
r_ib
r_k
Y1
rr_e
aux1
bm
spr_b
data_rBH
data_rBE
data_rD
data_rIB
data_PIW
data_PIE
Relation 2
Colinear variables:
c_p
h_p
d_p
l_p
lam_p
J_R
j_B
pie_wp
c_i
h_i
b_i
l_i
lam_i
s_i
pie_wi
I
c_e
k_e
l_pd
l_id
b_ee
y_e
lam_e
s_e
u
d_b
b_h
b_e
r_d
r_bh
r_be
R_b
K_b
pie
x
C
Y
D
BE
BH
B
w_p
w_i
q_h
K
PIW
r_ib
r_k
Y1
rr_e
aux1
bm
spr_b
data_rBH
data_rBE
data_rD
data_rIB
data_PIW
data_PIE
Relation 3
Colinear variables:
c_p
h_p
d_p
l_p
lam_p
J_R
j_B
pie_wp
c_i
h_i
b_i
l_i
lam_i
s_i
pie_wi
I
c_e
k_e
l_pd
l_id
b_ee
y_e
lam_e
s_e
u
d_b
b_h
b_e
r_d
r_bh
r_be
R_b
K_b
pie
x
C
Y
D
BE
BH
B
w_p
w_i
q_h
K
PIW
r_ib
r_k
Y1
rr_e
aux1
bm
spr_b
data_rBH
data_rBE
data_rD
data_rIB
data_PIW
data_PIE
Relation 1
Colinear equations
32 33 34 64
Relation 2
Colinear equations
32 33 34 64
Relation 3
Colinear equations
32 33 34 64
MODEL_DIAGNOSTICS: The presence of a singularity problem typically indicates that there is one
MODEL_DIAGNOSTICS: redundant equation entered in the model block, while another non-redundant equation
MODEL_DIAGNOSTICS: is missing. The problem often derives from Walras Law.
Thanks a lot.
M
