Eigenvalues

Dynare help (legacy posts)
1

Can anyone tell me that what should I do when it shows that

EIGENVALUES:
Modulus Real Imaginary

        0.95             0.95                0
       1.005            1.002          0.08288
       1.005            1.002         -0.08288
         Inf              Inf                0

There are 3 eigenvalue(s) larger than 1 in modulus
for 2 forward-looking variable(s)

The rank conditions ISN’T verified!

How can I do in order to meet the rank condition?

Thank you very much

2

Hi,

You should (in this order):

[ol]
] Check your steady state./:m]
] Check that the timing of the variables of your model is correct./:m]
] Check your model./:m]
] Change your model…/:m][/ol]

This is what I do when I have this kind of problem.

Best, Stéphane.

3

You could make additional action:
V Check parameters values

It is often that wrong coefficient at government policy leads to rank condition problems.

4

Thank you very much for your helps