I’m a master student and I have developed for my master thesis a DSGE of Euro Area.
It’s the first time I used Dynare and my model is very complicated (at least for my preparation).
Specifically, I tried to log-linearize it and to solve my SS Variables making Great Ratio.
I found after that dynare doesn’t accept Ratio in parameters initialization and for this reason, i decided to insert real values of Italy and Europe so that it would be the model to calculate the ratio itself.
In this version, I haven’t yet all the behavioral parameters, but trying to simulate my model with some literature parameter dynare gives me the following error.
Sorry if I’m not an expert but this is the first time I do something so complicated.
I would be really grateful for your help.LDG.mod (13.1 KB)
**_There are 14 eigenvalue(s) larger than 1 in modulus _** **_for 14 forward-looking variable(s)_** **_The rank condition ISN'T verified!_** **_Warning: stoch_simul: using order = 1 because Hessian is equal to zero _** **_> In stoch_simul (line 41)_** **_ In ldgcorretto (line 904)_** **_ In dynare (line 235) _** **_Error using print_info (line 48)_** **_Blanchard Kahn conditions are not satisfied: indeterminacy due to rank failure_** **_Error in stoch_simul (line 100)_** **_ print_info(info, options_.noprint, options_);_** **_Error in ldgcorretto (line 904)_** **_info = stoch_simul(var_list_);_** **_Error in dynare (line 235)_** **_evalin('base',fname) ;_**