Hello Prof. Pfeifer @jpfeifer ,
Could you kindly briefly check my problem? I am looking forward to hear from you and sorry for so many edit.
- I am estimating my model now with the log-linearized version. I need to estimate the monetary and fiscal tax rule coefficients, but one problem rise. Dynare keeps telling me that the Blanchard-Kahn condition is not satisfied. The error information is shown in the picture below.
I don’t know whether I interpret the B-K condition correctly. I used the Uhlig toolkit to run the IRF estimation for my model using parameters value same as the SMM code. All variables converge there. I think it means that my model should have stable equilibrium then. I am confused.
In addition, why Matlab keeps telling me that it could not normalize the dynamic model?
I attach code for my model below. The file “Convenience_NK_SMM.mod” estimate my model, targeting the model file “NK_Model_linearized.inc”The “Moment 70-99.mat” is empirical data for moment.
Convenience_NK_SMM.mod (8.9 KB)
NK_Model_linearized.inc (3.8 KB)
Moment 70-99.mat (2.1 KB)
- Besides, now I want to add a variance as a second-order moment so I try to set prefilter=1 (ie: variance of VoT). However, it seems that if I include a variance as a moment, I can not use a mean as moment at the same time (the first-order moment E(RR) will be ignored). So could you tell me how to include a mean and a variance as moments in one estimation?
Thank you for any response for my question in advance!