I m new to DSGE & Dynare and after reading so many posts from the forum, I m still confuse about the data transformation in DYNARE. Appreciate it if someone can confirm that the correct procedure to transform level form data for estimation? As what I understand, from the level form data, we need to
- Log difference
It is the correct way? If yes, then do we still need to use (prefilter=1) in the dynare code?
Thank you very much