Dear all,

I have a download file from professor frank schorfheide’s website (mod and data files are attached below). When I tested it, it reports the error messages as follows. I have no idea why. When I run the non-demeaned model, it works perfect. Could any of you help me spot the problem?

Second, I want to know if I want put ‘endogenous_prior’ option in estimation block. Do I need to specify prior density in ‘estimated_params’ block as usual? It does not seems right to me.

Many thanks!

Best,

Richard

POSTERIOR KERNEL OPTIMIZATION PROBLEM!

(minus) the hessian matrix at the “mode” is not positive definite!

=> posterior variance of the estimated parameters are not positive.

You should try to change the initial values of the parameters using

the estimated_params_init block, or use another optimization routine.

Warning: The results below are most likely wrong!

In dynare_estimation_1 at 694

In dynare_estimation at 89

In us_m1_demeaned at 190

In dynare at 180

Error using chol

Matrix must be positive definite.

Error in metropolis_hastings_initialization (line 68)

d = chol(vv);

Error in random_walk_metropolis_hastings (line 62)

ix2, ilogpo2, ModelName, MetropolisFolder, fblck, fline, npar, nblck, nruns,

NewFile, MAX_nruns, d ] = …

Error in dynare_estimation_1 (line 782)

feval(options_.posterior_sampling_method,objective_function,options_.proposal_distribution,xparam1,invhess,bounds,dataset_,options_,M_,estim_params_,bayestopt_,oo_);

Error in dynare_estimation (line 89)

dynare_estimation_1(var_list,dname);

Error in us_m1_demeaned (line 190)

dynare_estimation(var_list_);

Error in dynare (line 180)

evalin(‘base’,fname) ;

us_euro_data_demeaned.m (446 Bytes)

us_m1_demeaned.mod (2.69 KB)