Error using steadystate

Dynare help (legacy posts)
1

Hi All,

I am working on a Bayesian DSGE model. The model goes through the initial stage of solving however when I reach the estimation stage I get the following error. I am new to Dynare and thus not very sure if the steadystate.m file I am using is correct. Please have a look at the files.

Any help is deeply appreciated.

There are 7 eigenvalue(s) larger than 1 in modulus
for 7 forward-looking variable(s)

The rank condition is verified.

Loading 112 observations from datafirst.m

??? Error using ==> initial_estimation_checks at 78
The seadystate values returned by first1_steadystate.m don’t solve the static model!

Error in ==> dynare_estimation_1 at 320
initial_estimation_checks(xparam1,gend,data);

Error in ==> dynare_estimation at 62
dynare_estimation_1(var_list,varargin{:});

Error in ==> first1 at 382
dynare_estimation(var_list_);

Error in ==> dynare at 102
evalin(‘base’,fname) ;
datafirst.m (7.34 KB)
first1_steadystate.m (2.25 KB)
first1.mod (5.14 KB)

2

I am very confused as the equations listed in the mod file are satisfied at the values generated by the steady state file but still I get the error that steady state file does not solve the model. Has it got anything to do with the fact that I have assigned a value to steady state ratio of networth/capital (n/k), denoted as nk and then carried out the steady state calculations for all other variables.

Any help is much appreciated.