Hi, all
I am facing a problem with my code. Here is the mod file.
BIUGK.mod (6.4 KB)
I build up a bond-in-utility model nested in the GK2011 model and fix the bond price q by setting Upsilon which is beta plus the value of c/bc (bc referring to as the bond held by the household) at steady state. Beside, I assume that the banks invest certain amount of government bond (which is bb in the file) proportional to the loans to the firms, which is equal to \Delta * Q * s. However, so far it seems the steady state can’t be solved. Please could you help me with the codes? Thank you in advance.
Only do the exp-substitution once the model works.