I am running a model that makes use of the Heaviside function. Does Dynare recognize such a function? If not, is there a way to program it into Dynare?


The Heaviside function

doesn’t have a derivative at 0. Therefore, it can’t be used in a stochastic model splved by local (first or second order) approximation.

In deterministic model, Dynare may be able to compute a traectory, but there is no guarantee…

In general, you can define any function in a separate *.m file and call it from inside a Dynare *.mod file. But, again, for non trivial functions, it is your responsibility that you can apply local approximation if you work with a stochastic model.

Kind regards