Error using ==> dynare_solve at 60

Dynare help (legacy posts)
1

Good evening.

I’m having trouble finding the steady state of a DSGE model with banks. The following message always appears:

??? Error using ==> dynare_solve at 60
An element of the Jacobian is not finite or NaN.

I am a beginner and would like to know if there are any suggestions?

Thank you
model2.mod (7.93 KB)

2

First of all, only do the exp()-substitution once the model runs. Premature substitutions result in cumbersome code that is hard to debug. For example

exp(A) = rhoa*exp(A(-1)) + ee_a; // // (31) exp(j) = rhob*exp(j(-1)) + ee_j; // // (32)
has a steady state for e.g. exp(A) of 0, implying that A must be -Inf.

Also

[quote]Warning: Some of the parameters have no value (tal, mu, kappa, rhoc) when using steady. If these
parameters are not initialized in a steadystate file or a steady_state_model-block, Dynare may not be
able to solve the model…
[/quote]