Colinear equations problems

Dynare help (legacy posts)
1

Dear professor jpfeifer:
When we run the modeltwo.mod file in dynare, the error information is coming up with the following message:
………

model_diagnostic: the Jacobian of the static model is singular
there is 5 colinear relationships between the variables and the equations
Relation 1
Colinear variables:
C_d
C_i
C_fd
C_md
C_fi
C_mi
gama_dc
gama_ic
gama_md
gama_fd
gama_fi
gama_mi
gama_estr
k
i
Y_oil
Y_Fd
L_f
K_f
rer
x
si
T
t_d
y
im
fr
Relation 2
Colinear variables:
C_d
C_fd
C_md
gama_dc
gama_md
gama_fd
Relation 3
Colinear variables:
C_d
C_i
C_fd
C_md
C_fi
C_mi
gama_dc
gama_ic
gama_md
gama_fd
gama_fi
gama_mi
gama_estr
k
i
Y_oil
Y_Fd
L_f
K_f
rer
x
si
T
t_d
y
im
fr
Relation 4
Colinear variables:
C_d
C_i
C_fd
C_md
C_fi
C_mi
gama_dc
gama_ic
gama_md
gama_fd
gama_fi
gama_mi
gama_estr
k
i
Y_oil
Y_Fd
L_f
K_f
rer
x
si
T
t_d
y
im
fr
Relation 5
Colinear variables:
C_d
C_i
C_fd
C_md
C_fi
C_mi
gama_dc
gama_ic
gama_md
gama_fd
gama_fi
gama_mi
gama_estr
k
i
Y_oil
Y_Fd
L_f
K_f
rer
x
si
T
t_d
y
im
fr
Relation 1
Colinear equations
Columns 1 through 18

 2     4     6     8    10    12    13    14    15    16    18    19    20    21    27    32    33    34

Columns 19 through 27

35    36    37    38    39    40    49    51    52

Relation 2
Colinear equations
Columns 1 through 18

 2     4     6     8    10    12    13    14    15    16    18    19    20    21    27    32    33    34

Columns 19 through 27

35    36    37    38    39    40    49    51    52

Relation 3
Colinear equations
Columns 1 through 18

 2     4     6     8    10    12    13    14    15    16    18    19    20    21    27    32    33    34

Columns 19 through 27

35    36    37    38    39    40    49    51    52

Relation 4
Colinear equations
Columns 1 through 18

 2     4     6     8    10    12    13    14    15    16    18    19    20    21    27    32    33    34

Columns 19 through 27

35    36    37    38    39    40    49    51    52

Relation 5
Colinear equations
Columns 1 through 18

 2     4     6     8    10    12    13    14    15    16    18    19    20    21    27    32    33    34

Columns 19 through 27

35    36    37    38    39    40    49    51    52

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.
Error using print_info (line 42)
Blanchard Kahn conditions are not satisfied: no stable equilibrium

Error in stoch_simul (line 98)
print_info(info, options_.noprint, options_);

Error in modeltwo (line 841)
info = stoch_simul(var_list_);

Error in dynare (line 180)
evalin(‘base’,fname) ;

In generally, how do we to solve the Colinear equations problems?

Thank you much for your help and support!
The mod file as follows:
Modeltwo.mod (10.7 KB)

2

Just the usual generic advice: start with a simple® version of the model and see where the problem comes from. With a model that big, there is not much hope of debugging.

3

Hi Prof. Pfeifer,

Thank you so much for your reply.

4

Hi,
my suggestion may goes into the wrong direction, but you might check the following:

  1. The following endogenous variables aren’t present at the current period in the model:
    K_f

  2. Some of the collinearities may come from the existence of unit roots, which is treated by “model_diagnostics” as an collinearity problem even your BK and rank conditions verified.

eigenvalues could be found at: oo_.dr.eigval