Dear all,
Can we have a negative shock in simulation? How? Thanks in advance.
Kind regards,
Dave
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Re: Negative shocks
by SébastienVillemot » Fri Nov 20, 2009 9:14 am
Hi,
If you are in a deterministic setup, you can put the shocks that you want, positive or negative, in the shocks block.
If you are in a stochastic setup, Dynare by default compute IRFs for one positive standard deviation of each of the shocks. To get the result for one negative standard deviation, one easy solution is just to invert the sign of the given shock in all the equations. Another is to construct simulations by yourself, using the simult_.m function provided by Dynare.
Best,
If you are in a deterministic setup, you can put the shocks that you want, positive or negative, in the shocks block.
If you are in a stochastic setup, Dynare by default compute IRFs for one positive standard deviation of each of the shocks. To get the result for one negative standard deviation, one easy solution is just to invert the sign of the given shock in all the equations. Another is to construct simulations by yourself, using the simult_.m function provided by Dynare.
Best,
Sébastien Villemot
Economist at OFCE – Sciences Po
Economist at OFCE – Sciences Po
- SébastienVillemot
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