Colinear equations

Steady state
1

Dear users. I posted some hours ago about problem in the steady state computation in my model (here attached in the latest version). Now in some ways I was able to find a kind of steady state, but dynare gives me the following error message:

BlockquoteError using print_info (line 54)
One of the eigenvalues is close to 0/0 (the absolute value of numerator and denominator is smaller than 1e-06!
If you believe that the model has a unique solution you can try to reduce the value of qz_zero_threshold.

Using the command model_diagnostics(M_,options_,oo_), the answer is:

model_diagnostics(M_,options_,oo_)
MODEL_DIAGNOSTICS: The Jacobian of the static model is singular
MODEL_DIAGNOSTICS: there is 2 colinear relationships between the variables and the equations
Relation 1
Colinear variables:
h_s
h_u
s_s
s_u
p_s
p_u
q_s
q_u
M_s
M_u
v_s
v_u
c
y
w_s
w_u
theta_s
theta_u
u_s
u_u
gamma
Relation 2
Colinear variables:
h_s
h_u
s_s
s_u
p_s
p_u
q_s
q_u
M_s
M_u
v_s
v_u
c
y
w_s
w_u
theta_s
theta_u
u_s
u_u
gamma
Relation 1
Colinear equations
18 19

Relation 2
Colinear equations
18 19
I think equations 18 and 19 are correct. They represent foc for the firm, each one for every sector in the labor market (skilled, unskilled), so they should be very similar but different. My knowledge of dynare is not sufficient to understand what’s the problem.
Cam someone please help me?
Thank you!provasenzagamma.mod (4.1 KB)

2

I really need help. Can someone give a look to my request, please?
Thank you so much

3

Check your steady state. One of the wages is negative. This is caused by you using a check for equality (==) instead of an equal sign. Once you fix this, the steady_state_model turns out to be incorrect. Also: it strange that you do not need
z=omega_z*z(-1)+e_zeta;
to determine z in your model. This suggests that you have one redundant equation in your model.