Hi,

When I try and run the attached mod file of a two-country model I get the error message that indicates that it is impossible to find the steady state.

I believe the reason is that the residuals from the static equation do not all equal zero (about half do) but the problem is I cannot figure out why. My initial values are mostly solved analytically while the ones that are not come from economy theory, e.g. consumption greater than investments. I have also reviewed both my model equations and steady state equations used to determine the initial values and I cannot find the error.

I have attached the mod file with the hope that someone can spot the error.

Thanks in advance,

Jeremy

JKTwo_Country_Simple_V3.mod (6.62 KB)

The recent unstable provides a trust-region solver (solve_algo=4). Using the attached file is able to find a steady state. This allows running model_diagnostics, which says

[quote]model_diagnostic: the Jacobian of the static model is singular

there is 4 colinear relationships between the variables and the equations

Relation 1

Colinear variables:

b_h

b_f

s

c_star

m_star

p_star

l_star

b_hstar

b_fstar

w_star

s_star

Relation 2

Colinear variables:

b_h

b_f

s

c_star

m_star

p_star

l_star

b_hstar

b_fstar

w_star

s_star

Relation 3

Colinear variables:

b_h

b_f

s

c_star

m_star

p_star

l_star

b_hstar

b_fstar

w_star

s_star

Relation 4

Colinear variables:

c

m

p

l

b_h

b_f

w

s

c_star

m_star

p_star

l_star

b_hstar

b_fstar

w_star

Relation 1

Colinear equations

3 4 5 9 16 17 18 22

Relation 2

Colinear equations

3 4 5 9 16 17 18 22

Relation 3

Colinear equations

3 4 5 9 16 17 18 22

Relation 4

Colinear equations

3 4 5 9 16 17 18 22

The presence of a singularity problem typically indicates that there is one

redundant equation entered in the model block, while another non-redundant equation

is missing. The problem often derives from Walras Law.[/quote]

JKTwo_Country_Simple_V3.mod (6.66 KB)