Error in steady state


#1

Hi, after calibrating and running the model, I received the following error:

Residuals of the static equations:

Equation number 1 : 0
Equation number 2 : -6.683e-06
Equation number 3 : 0
Equation number 4 : 0
Equation number 5 : 0
Equation number 6 : 0
Equation number 7 : 80.6872
Equation number 8 : 0
Equation number 9 : -15053.4312
Equation number 10 : 0.11755
Equation number 11 : 0
Equation number 12 : 0
Equation number 13 : 0
Equation number 14 : -80.6196
Equation number 15 : 0
Equation number 16 : -33967.7307
Equation number 17 : 0
Equation number 18 : 0
Equation number 19 : 0
Equation number 20 : 0
Equation number 21 : 0

Error using print_info (line 76)
The steadystate file did not compute the steady state
Error in steady (line 104)
print_info(info,options_.noprint, options_);
Error in Sentiment (line 316)
steady;
Error in dynare (line 235)
evalin(‘base’,fname) ;

Sentiment_steadystate.m (2.1 KB)
Sentiment.mod (6.2 KB)


#2

What is your question? From the error message it is obvious that you made an error in the model definition and/or the steady state file… The first thing to do is to check all the equations with non zero residuals and the steady state you define for the variables appearing in these equations.

Best,
Stéphane.


#3

After making some changes to the equations, the residual of equation 9 became zero, but the remaining non-zero equations are still present. I’m not able to find a mistake, I’m looking for it since … :worried:
Sentiment.mod (6.2 KB)
Sentiment_steadystate.m (2.0 KB)

I appreciate any kind of comment / hint / advise.

Many thanks!


#4

Is it possible that the parameters are wrong?


#5

In principle yes… It may be that for some parameter values the steady state does not exist. But I do not think it is your problem here, or you would know it, since you seem to be able to compute the steady state analytically.

You really need to check all the equations in the model block and in the steady state routine. For instance, I think there is a parenthesis error in the second equation of the model (the one for money demand). Shouldn’t you divide i by 1+i on the right hand side? If I do that the residual becomes exactly zero in this equation. The next non zero residual equation is the one defining the production function. This suggests there is an error in the steady state definition of y, k and/or n. So I would redo the algebra here…

Best,
Stéphane.


#6

thank you for your hint
I have modified some of the equations, but still have non-zero residual in three equations, and on the other hand, Dynare warns that y is complex. What do you mean by that?
Sentiment2.mod (3.9 KB)
Sentiment2_steadystate.m (1.9 KB)

resid: The initial values for the steady state of the following variables are complex:
y

Residuals of the static equations:

Equation number 1 : 0
Equation number 2 : 0
Equation number 3 : 0
Equation number 4 : 0
Equation number 5 : 0
Equation number 6 : 0
Equation number 7 : 0
Equation number 8 : 0
Equation number 9 : -0.0074509
Equation number 10 : 0
Equation number 11 : 0
Equation number 12 : 0
Equation number 13 : 1.15
Equation number 14 : 0
Equation number 15 : -338236.5839
Equation number 16 : 0
Equation number 17 : 0
Equation number 18 : 0
Equation number 19 : 0

Error using print_info (line 76)
The steadystate file did not compute the steady state
Error in steady (line 104)
print_info(info,options_.noprint, options_);
Error in Sentiment2 (line 269)
steady;
Error in dynare (line 235)
evalin(‘base’,fname) ;


#7

thank you for your hint
I have modified some of the equations, but still have non-zero residual in three equations, and on the other hand, Dynare warns that y is complex. What do you mean by that?
Sentiment2.mod (3.9 KB)
Sentiment2_steadystate.m (1.9 KB)

resid: The initial values for the steady state of the following variables are complex:
y

Residuals of the static equations:

Equation number 1 : 0
Equation number 2 : 0
Equation number 3 : 0
Equation number 4 : 0
Equation number 5 : 0
Equation number 6 : 0
Equation number 7 : 0
Equation number 8 : 0
Equation number 9 : -0.0074509
Equation number 10 : 0
Equation number 11 : 0
Equation number 12 : 0
Equation number 13 : 1.15
Equation number 14 : 0
Equation number 15 : -338236.5839
Equation number 16 : 0
Equation number 17 : 0
Equation number 18 : 0
Equation number 19 : 0

Error using print_info (line 76)
The steadystate file did not compute the steady state
Error in steady (line 104)
print_info(info,options_.noprint, options_);
Error in Sentiment2 (line 269)
steady;
Error in dynare (line 235)
evalin(‘base’,fname) ;


#8

Are you sure your model has a proper steady state with trend inflation and PI being different from PIstar? For some reason, PIstar does not enter in your steadx state file, but it should affect the steady state via the monetary policy reaction function
mb=mb(-1)^rhomb*(PI/PIstar)^LambdaPI*y^Lambday*exp(nu);
That equation is also strange, because the level of output enters, not growth rates or deviations from the steady state.


#9

Hi, I’ve tested different Monetary policy reaction function for my model which include growth rate or deviations from the steady state, but I still have the same problem.
What do you think the problem is?

Sentiment2.mod (4.2 KB)
Sentiment2_steadystate.m (1.9 KB)

Residuals of the static equations:

Equation number 1 : 0
Equation number 2 : 0
Equation number 3 : 0
Equation number 4 : 0
Equation number 5 : 0
Equation number 6 : 0
Equation number 7 : 0
Equation number 8 : 0
Equation number 9 : 0
Equation number 10 : 0
Equation number 11 : 0
Equation number 12 : 0
Equation number 13 : -1.6966
Equation number 14 : 0
Equation number 15 : 0
Equation number 16 : 0
Equation number 17 : 0
Equation number 18 : 0
Equation number 19 : 0