A model of unconventional monetary policy, Gentler e Karadi 2011

Hi, can you help me to understand what is the meaning of exp(-e_ne) in the equation number 12 of this code FA_CP_model.m (4.2 KB) ?? I’m working with this Gentler e Karadi’s paper gentler e karadi 2011.pdf (482.5 KB).

It seems like a negative shock to net worth, but your file does not include the variable declarations.

it’s not my code but those that i’ve tried on Peter Karadi’s website

codice.mod (5.9 KB)
this is my code, but it seems like un error with the steady state

Now you can clearly see it’s a negative capital quality shock.

yes, i’ve just fixed it after your answer but the problem with steady state there’s still

You did not mention any steady state problem.

Sorry, i thought I had done it. Could you help me to understand which is the error?
When I try to run the model, dynare tell me this “Error using print_info
Impossible to find the steady state (the sum of
square residuals of the static equations is
46829.7782). Either the model doesn’t have a
steady state, there are an infinity of steady
states, or the guess values are too far from the

The message is pretty self-explanatory. Given your provided initial values, no steady state could be found.

ok, thank you. But if the model is expressed in exp(), the steady state’s relationships need to be expleined or is sufficient the initval block ??

In theory, initval should be sufficient. But