Hi! I am trying to use a dsge model to study about DMP model. Every time, I run the code, I get following notification: An Infinite element was encountered when trying to solve equations with respect to variable mo. I am confused what is the meaning of this? I tried to get help from previous posts but couldn’t. Can anybody help me?
Thanks!
That usually means that there is a mistake in your equations that prevents the Newton solver from finding a steady state. Essentially, the derivative of your equation implies that to solve the equation you would need a variable to be infinite, which cannot be a solution.