Good evening everyone,

I am trying to replicate a model with climate change, where the production sector is producing using formal and informal technology. Even though I manually calculated and specified initial values for the steady state the model does not seem to work ( I am getting the warning “Impossible to find the steady state (the sum of square residuals of the static equations is 1.0058”).

The function ss_no_policy_S solves for the initial values of the steady state, and the file SSCalculationFinal provides manual calculations for steady state values.

It might also be the case that I have timing issues in my equations, though so far I could not manage to make Dynare solve the model.

Any remark regarding potential issues would be very appreciated

np_recalibrated_BR_S.mod (7.8 KB)

ss_no_policy_S.m (1.2 KB)

SSCalculationFinal.m (1.7 KB)