Dear professors:

I’m a beginner, and want to estimate a dsge model, but alwasys get this error messgae.

Here is matlab display:

Using 64-bit preprocessor

Starting Dynare (version 4.6.4).

Calling Dynare with arguments: none

Starting preprocessing of the model file …

Found 24 equation(s).

Evaluating expressions…done

Computing static model derivatives (order 1).

Computing dynamic model derivatives (order 1).

Processing outputs …

done

Preprocessing completed.

Residuals of the static equations:

Equation number 1 : 0 : Lagrange multiplier

Equation number 2 : 0 : euler equation

Equation number 3 : 0 : money demand

Equation number 4 : 0 : resource restriction

Equation number 5 : 0 : aggregated production

Equation number 6 : 0 : inflation evolution

Equation number 7 : 0 : price dipersion

Equation number 8 : 0 : auxiliary x1

Equation number 9 : 0 : auxiliary x2

Equation number 10 : 0 : optimal price setting

Equation number 11 : 0 : optimal wage setting

Equation number 12 : 0 : auxiliary h1

Equation number 13 : 0 : auxiliary h2

Equation number 14 : 0 : wage evolution

Equation number 15 : 0 : marginal cost

Equation number 16 : 0 : fisher equation

Equation number 17 : 0 : policy rule

Equation number 18 : 0 : money supply

Equation number 19 : 0 : technology shock

Equation number 20 : 0 : preference shock

Equation number 21 : 0 : output observation equation

Equation number 22 : 0 : inflation observation equation

Equation number 23 : 0 : interest rate observation equation

Equation number 24 : 0 : money supply observation equation

EIGENVALUES:

Modulus Real Imaginary

```
4.996e-16 -4.996e-16 0
0.3765 0.3765 0
0.7269 0.7269 0
0.7825 0.7825 0.006234
0.7825 0.7825 -0.006234
0.8531 0.8531 0
0.9 0.9 0
0.9 0.9 0
1.002 1.002 0
1.021 1.021 0
1.123 1.123 0
1.265 1.265 0
1.359 1.359 0
9.05e+16 9.05e+16 0
6.284e+48 6.284e+48 0
```

There are 7 eigenvalue(s) larger than 1 in modulus

for 7 forward-looking variable(s)

The rank condition is verified.

STEADY-STATE RESULTS:

lamb 2.62215

c -0.981156

i -3.30962

n -0.95885

y -0.981156

pi 0.0295588

pi_star 0.0988325

w -0.201313

m 1.86438

mc -0.201313

vp 0.0223054

x1 3.2317

x2 3.34475

w_star -0.106823

h1 2.63241

h2 2.92156

r 0.00631993

a 0

gm 0

v 0

y_obs 0

pi_obs 0

i_obs 0

gm_obs 0

MODEL_DIAGNOSTICS: No obvious problems with this mod-file were detected.

You did not declare endogenous variables after the estimation/calib_smoother command.

Posterior IRFs and forecasts will be computed for the 24

endogenous variables of your model, this can take a long

time …

Choose one of the following options:

[1] Consider all the endogenous variables.

[2] Consider all the observed endogenous variables.

[3] Stop Dynare and change the mod file.

options [default is 1] = 1

Error in computing likelihood for initial parameter values

ESTIMATION_CHECKS: There was an error in computing the likelihood for initial parameter values.

ESTIMATION_CHECKS: If this is not a problem with the setting of options (check the error message below),

ESTIMATION_CHECKS: you should try using the calibrated version of the model as starting values. To do

ESTIMATION_CHECKS: this, add an empty estimated_params_init-block with use_calibration option immediately before the estimation

ESTIMATION_CHECKS: command (and after the estimated_params-block so that it does not get overwritten):

Error using print_info (line 32)

Blanchard & Kahn conditions are not satisfied: indeterminacy.

Error in print_info (line 32)

error(message);

Error in initial_estimation_checks (line 196)

print_info(info, DynareOptions.noprint, DynareOptions)

Error in dynare_estimation_1 (line 164)

oo_ =

initial_estimation_checks(objective_function,xparam1,dataset_,dataset_info,M_,estim_params_,options_,bayestopt_,bounds,oo_);

Error in dynare_estimation (line 105)

dynare_estimation_1(var_list,dname);

Error in nk_exp_wage.driver (line 537)

oo_recursive_=dynare_estimation(var_list_);

Error in dynare (line 293)

evalin(‘base’,[fname ‘.driver’]) ;

Error in dynareee (line 4)

dynare nk_exp_wage;

and this is my model and datafile

data.mat (887.2 KB)

nk.mod (4.9 KB)