Hi Dynare-Team,

I am working with a standard NK model in which I introduce a ZLB, please see the attached mod file (technically it is a trend inflation model, but I have set the inflation target to 1% or 0 in SS so it is standard). I would like to show that at the ZLB, if I feed in a new aggregate demand (beta) shock every period, the mean of the simulated moment of inflation (Pi) is lower than the targeted moment, i.e. there is the risk of a deflationary spiral. I have a ZLB so I cannot use stoch_simul, I hence use perfect_foresight and feed in a vector of shocks that are randomly drawn from the standard normal (please see attached mod file).

My two questions thus are:

- How do I read out and graph the simulated variable moments?
- What is the best way to compare the simulated inflation mean moments to the targeted inflation mean?

defl_spiral_simulation.mod (7.7 KB)