- 50 periods is not long. 1000 periods is. Check whether there is a unit root that should not be there (use the check command to see the eigenvalues). If not the parameters and shock processes simply imply a huge persistence
- Regarding moments, if you use the attached files, you are computing absolute deviations instead of log deviations. As investment is a small share of GDP, the absolute deviations can be smaller. Define auxiliary variables like
and compare them.
3. For the rise in the nominal interest rate, see [Monetary Shock)