Detailed log-linearization steps of BGG(1999)

General DSGE Modeling Replication Attempts
1

Dear all,
I have different log-linearization outcomes with equation 4.17 and 4.24 in BGG(the financial accelerator in a quantitative business cycle framework, handbook of macroeconomics, chapter 21,1999), so the IRF is not completely the same as BGG.

I don’t know where I am wrong. I will be very grateful to you for pointing out my mistakes.

Thank you in advance!

BGG_LL.pdf (267.3 KB)

2

I’m sorry to disturb you and reply this question one year later.
Perhaps they did some approximate treatment but didn’t tell this in the text. If you have the same doubts as me, maybe you can get some insights from the lecture notes of Eric Sims.
Best wishes.
bbg_ers_notes_final.pdf (250.3 KB)

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