I’ve learn using the initval commands to enter the steady state even if the steady state is calculated on my own, while today I found a replication code using the form #zz to introduce the steady state. I’m really confused about how it work. Is the “#” form an another way to introduce the steady state?fbc1.mod (10.6 KB)
Thank you for your time. Have a nice day.

That is simply the way Iacoviello uses to introduce the steady-state levels of the variables as model-local variables in the model. For instance, since the external portfolio adjustment costs and capital adjustment costs that feature in his model depend on the deviation from the steady-state levels of deposits, loans, and capital stock, he analytically derives the level of these variables in steady-state and introduces them in the model via model-local variables (i.e. using the \# sign) to be able to compute the adjustment costs in the dynamics.