Almost there... need some advice, please :)

:smiley: Hello! Thank you for taking your time to help me!

I’m writing a code to run some shocks to a small open economy with formal and informal markets plus corruption in steady state.

Nevertheless, my code has some problems and won’t run.

I kindly request any advice or suggestion, I’m very grateful for even the most minor improvement!

Thank you so much!
code.mod (3.83 KB)
Variables and parameterts definition.pdf (375 KB)
Equations for Dynare.pdf (347 KB)

Please try with F9 in Matlab to sequentially execute your parameter definitions. You will see that


is not defined yet when you use it to compute


Another remark: you are not handling parameter dependence correctly. For stoch_simul this is no problem, but is nevertheless dangerous. See Pfeifer(2013): “A Guide to Specifying Observation Equations for the Estimation of DSGE Models”

Thank you so much!