Dear Colleagues

I am Ha

This questions is not related to Dynare Code but how the results make sense.

I carefully checked the code and the mathematical derivations and nothing goes wrong.

However when I run the Bayesian Estimation to obtain the Variance Decomposition, the results come out quite weird since the cost-push shock (eps_theta) and the trend inflation shock (eps_Pibar) have zero impact on all variables. I checked parameters relating to these shock to make sure that these shocks will play some roles in the model but the results remain the same.

Please take a look at my code and let me know how to fix the problem.

Another question is relating to the data used in the model. I used the non-linear model and the raw data. For example, regarding inflation, I used gdp delator , thus the gross inflation will be (gdp deflator (t)/ gdp deflator (t-1) and use this as the data estimation. ex, if gdp deflator (t+1)= 108.606; gdp deflator (t)=108.009, the gross inflation is 108.99/108.606=1.0055 and use it as the data for inflation. For the non-linear model, the way I did is right?

This is my codeModel_Uncertainty_Est_Base.mod (11.5 KB)

here is datadata_est.m (18.5 KB)

Any comment and suggestion are greatly appreciated

Thank you so much