Hello everyone,

I have a quick question regarding determinacy/indeterminacy graphs in dynare.

I am running the code below to check where my model is determinate for different values of Delta and phi_pi. However, it turns out that the graphs that I obtain are different when I calibrate different initial values of Delta and I don’t understand why because my steady-state is invariant on Delta (which is a share of constrained agents in my model). Normally because I do the loop on Delta I should have the same graph no matter what is the initial value no ?

Can someone understand why I get such a weird thing ? Maybe there is something I am doing wrong in the code.

Thanks in advance for your reply.

Hugo

phi_pi_vec=linspace(0,5,100);

Delta_vec=linspace(0,1,100);

[phi_pi_mat,Delta_mat]=meshgrid(phi_pi_vec,Delta_vec);

info_mat=NaN(size(phi_pi_mat));

if isempty(options_.qz_criterium)

options_.qz_criterium = 1+1e-6;

end

for phi_pi_iter=1:length(phi_pi_vec)

for Delta_iter=1:length(Delta_vec)

set_param_value(‘phi_pi’,phi_pi_mat(phi_pi_iter,Delta_iter));

set_param_value(‘Delta’,Delta_mat(phi_pi_iter,Delta_iter));

[dr,info]=resol(0,M_,options_,oo_);

info_mat(phi_pi_iter,Delta_iter)=info(1);

end

end

Z_plot=zeros(size(info_mat));

Z_plot(info_mat==0)=1;

figure(‘Name’,‘The Determinacy Region’)

contourf(phi_pi_mat,Delta_mat,Z_plot,1)

xlabel(‘\phi_\pi’)

ylabel(‘\Delta’)