Dynare failed to solve perfect foresight model

Dear Prof. Pfeifer,
I am trying to use dynare to solve a deterministic model. When the permanent shock is small, such as from 0.4 to 0.41 for a parameter, dynare can solve the model, but when the shock is larger, such as from 0.1 to 0.41, dynare failed to solve perfect foresight model. I‘ve tried stack_solve_algo from 1 to 7, but it failed. I really don’t know how to solve it .
(Attached is my code)
Thank you very much
solve_ss1.m (1.1 KB)
steady_state2.m (2.6 KB)
tran_path.mod (5.3 KB)

Have you tried solving the model without the exp()-substitution? Sometimes this creates numerical instabilities.

Thank you,Sir.
You are right. When I solve the model without the exp(), dynare can solve the model as taut goes from 0.1 to 0.41. But when I set initial value of taut as 0, it failed again.
Attached is my new code.
Thank you again.
solve_ss1.m (1.1 KB)
steady_state2.m (2.5 KB)
tran_path.mod (5.7 KB)

calibration1 is missing.

Sorry, Sir. You can delete “parameter = calibration1;” which seems doesn’t matter.

I guess

still applies here

Failed to solve perfect foresight model means simulated results are wrong? It looks ok to me though…just some small defects compared to the case when the error didn’t show up.

Yes, it means results do not satisfy the pre-specified tolerance.

1 Like