# Dynare log-linear model: Non-zero steady state, observation equations, and trend removal issues

**URL:** <https://forum.dynare.org/t/dynare-log-linear-model-non-zero-steady-state-observation-equations-and-trend-removal-issues/27848>\
**Category:** Steady state\
**Created:** [1 August 2025 18:09 UTC](https://forum.dynare.org/t/dynare-log-linear-model-non-zero-steady-state-observation-equations-and-trend-removal-issues/27848 "2025-08-01T18:09:06Z")\
**Posts on this page:** 3\
**Page:** 1

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**Author:** ![potgas](https://forum.dynare.org/letter_avatar_proxy/v4/letter/p/c37758/32.png) [@potgas](https://forum.dynare.org/u/potgas)\
**Post date:** [1 August 2025 18:09 UTC](https://forum.dynare.org/t/dynare-log-linear-model-non-zero-steady-state-observation-equations-and-trend-removal-issues/27848/1 "2025-08-01T18:09:06Z")

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Hi everyone,

I’m working with a log-linear DSGE modelfor Bayesian estimation. My model includes several observed variables (consumption growth, nominal interest rate, and Inflation), and I face some conceptual and technical challenges in handling:

data\_CC = C - C(-1) + TRENDC;  
data\_IR = R + Rb（IRMEAN）;  
data\_DP = pi +pi\_bar(DP MEAN);

My model is specified as log-linear, and all endogenous variables are defined in hat form . However, many of the steady state values in the output are not exactly zero. Could someone help me understand what might be causing this?

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**Author:** ![jpfeifer](https://forum.dynare.org/user_avatar/forum.dynare.org/jpfeifer/32/5044_2.png) [@jpfeifer](https://forum.dynare.org/u/jpfeifer)\
**Post date:** [1 August 2025 18:44 UTC](https://forum.dynare.org/t/dynare-log-linear-model-non-zero-steady-state-observation-equations-and-trend-removal-issues/27848/2 "2025-08-01T18:44:11Z")

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Linear equations can have constant terms. They need to be properly handled in a `steady_state_model` block. See e.g. [DSGE\_mod/Smets\_Wouters\_2007/Smets\_Wouters\_2007\_45.mod at master · JohannesPfeifer/DSGE\_mod · GitHub](https://github.com/JohannesPfeifer/DSGE_mod/blob/master/Smets_Wouters_2007/Smets_Wouters_2007_45.mod)

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**Author:** ![potgas](https://forum.dynare.org/letter_avatar_proxy/v4/letter/p/c37758/32.png) [@potgas](https://forum.dynare.org/u/potgas)\
**Post date:** [1 August 2025 22:57 UTC](https://forum.dynare.org/t/dynare-log-linear-model-non-zero-steady-state-observation-equations-and-trend-removal-issues/27848/3 "2025-08-01T22:57:52Z")

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Dear Professor ，

Thank you very much for your guidance regarding the steady-state handling of linear models.