Error in conducting Bayesian estimation

Hello, I am replicating the Bayesian estimation part of Justiniano and Preston (2010, Journal of Applied Econometrics). This is a small open economy DSGE model, and I am estimating the parameters for this model.

As I run the model, I get the following errors:

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):

and this as well:

Blanchard & Kahn conditions are not satisfied: no stable equilibrium.

I attach my dynare codes and the data. Hope someone can tell me what the problem is.

soedsge1.mod (3.9 KB) kordat.m (8.6 KB)

Dear ygyun,

when you use model model_diagnostics; in a stochastic simulation, dynare tells you that your model has a unit root in exch. There are many questions related to this in the forum, but simply you have to use the diffuse_filter option in estimation. Then, if there are not other problems, it should work.


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Thank you for your help, DoubleBass. I will make sure that the variables in my data are stationary. (The observed variables should be stationary in my model.) Thank you so much!