A problem with the transition path

Perfect foresight simulations
1

Dear All,

I currently use dynare to conduct my work on the transition path (permanent shock on steady state changes). However, when i finish my coding the dynare always comes out the identical steady state results in spite of the inputs with different values on “initval” and “endval”. I hope someone can give me any recommendation on this problem, that would be very helpful. The mod is enclosed.

Best,
J
GKK.mod (1.6 KB)

2

Jazzy,

You need to initialize your variable phi as an exogenous variable:

var Lambda C R L Y K I mu nu Ne Rk x z;

varexo phi;

3

You try to set phi in the blocks, but then in the steady_state_model you hardcode its value. Define it as an exogenous variable as @andre suggested and compute the steady state conditional on it.

4

Thank you, andre and Johannes, it finally works.