DYNARE_SOLVE (solve_algo=2|4): the Dulmage-Mendelsohn decomposition returned a non-square block. This means that the Jacobian is singular. You may want to try another value for solve_algo.

Steady state
1

Hi,
I’m trying to replicate the baseline model in Neumeyer and Perri (2005). It is a modified neoclassical small open economy model.
I’m coming across this error, which I’m not sure how to handle:
DYNARE_SOLVE (solve_algo=2|4): the Dulmage-Mendelsohn decomposition returned a non-square block. This means that the Jacobian is singular. You may want to try another value for solve_algo.

Any help/advice will be greatly appreciated. I’ve attached the .mod file.
replication_code.mod (1.5 KB)

2

Check the model implementation.

t = t(-1)+1;

is clearly not consistent with a steady state. Also note that that model is hard to numerically replicate due to issues with time aggregation and filtering.

3

Hi,
Thanks for your response. I’ve fixed the issue with using t (I’ve attached the updated file).
replication_code2.mod (1.4 KB)

But now it’s producing a different error:

Error using print_info (line 33)
Impossible to find the steady state (the sum of squared residuals of the static equations is 91.7183). Either the model
doesn’t have a steady state, there are an infinity of steady states, or the guess values are too far from the solution

Do you know what the best way is to troubleshoot this problem?

4

You did not provide initial values for the steady states.