Dear all,
If I run the attached mod file, there will be a warning message below, why BK conditions are not satisfied given 5 vs 5? Thanks!
There are 5 eigenvalue(s) larger than 1 in modulus
for 5 forward-looking variable(s)
The rank condition ISN’T verified!
Error using print_info (line 48)
Blanchard Kahn conditions are not satisfied: indeterminacy due to
rank failure
REDnocaphab.mod (2.51 KB)
I only get
[quote]EIGENVALUES:
Modulus Real Imaginary
9.308e-18 9.308e-18 0
1.871e-12 -1.871e-12 0
0.06017 -0.06017 0
0.9 0.9 0
0.9 0.9 0
1.01 1.01 0
5.653 5.653 0
7.189e+15 -7.189e+15 0
9.305e+17 -9.305e+17 0
2.16e+30 -2.16e+30 0
There are 5 eigenvalue(s) larger than 1 in modulus
for 4 forward-looking variable(s)
The rank condition ISN’T verified![/quote]
This looks like a standard timing problem. Given that you define
Ll Lb
as predetermined, but
Ll+Lb=L;
you might want to have a look at [Timing of capital in two sector economy)