Model with Many Leads and Lags: BK Condition Not Satisfied

[koyukiko]

I am new to Dynare and currently working on a model with many leads and lags. When I tried to solve my model using Dynare, I got the following error message. After using the model_diagnostics command, it seems that I have one colinear relationship in my model, but because of the auxiliary variables generated by Dynare I couldn't figure out what would be the exact problem. So I was wondering if someone could help me to check. Many thanks in advance.

Error using print_info (line 42)
Blanchard Kahn conditions are not satisfied: no stable equilibrium

Error in dyn_risky_steadystate_solver>risky_residuals (line 185)
print_info(info,options.noprint,options);

Error in solve1 (line 88)
t = feval(func,xdh,varargin{:});

Error in dyn_risky_steadystate_solver (line 127)
[ys, info] = solve1(func,ys0,1:endo_nbr,1:endo_nbr,0,1, options.gstep, ...

Error in stochastic_solvers (line 209)
[dr,info] = dyn_risky_steadystate_solver(oo_.steady_state,M_,dr, ...

Error in resol (line 137)
[dr,info] = stochastic_solvers(dr,check_flag,M,options,oo);

Error in stoch_simul (line 88)
[oo_.dr,info,M_,options_,oo_] = resol(0,M_,options_,oo_);

Error in IF_notax_CRRA (line 224)
info = stoch_simul(var_list_);

Error in dynare (line 180)
evalin('base',fname) ;

[jpfeifer]

As your model features several unit roots, these will always trigger a collinearity warning. With a complex model like this, there is only the standard advice. Simplify your model as far as possible to find out where the problem is coming from. For example, use fewer leads and lags. They are often not needed in the most parsimonious version of a model.