Blanchard-Kahn conditions, an error message


I try to replicate a model from Cespedes et al(2000). The model with flexible exchange rate works rather well but the model with fixed exchange rate does not work at all. If I run the code (estim6.mod, here attached) I have an error message:

*There are 4 eigenvalue(s) larger than 1 in modulus
for 4 forward-looking variable(s)

The rank conditions ISN’T verified!*

How is it possible that the rank condition is not verified if the number of non-predetermined variables equals the number of eigenvalues greater than one?

What was my mistake?

Please help me, it is really important for me.

Thank you in advance,
cespedes_al.pdf (414 KB)
estim3.mod (1.05 KB)
estim6.mod (1.04 KB)


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