Hi. I’m trying to estimate the Gali-Monacelli (2005) open small economy based on Pfeifer’s code, but I’m receiving this message:
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):
Error using print_info (line 32) Blanchard & Kahn conditions are not satisfied: no stable equilibrium.
I’ve already checked the equations and try to used the use_calibration in estimated_params_init, but it didn’t solve it.
Would you help me, please?Gali_orig_Est.zip (14.2 KB)