// (8) Spread

theta * mu = sdf * Omega(+1) * (R_K(+1) - R(+1));

// (9) Ex ante MV of net worth

Omega = (1-delta_B) + delta_B*nu;

// (10) Ex post MV of net worth

nu = (sdf*Omega(+1)*R(+1))/(1-mu);

HI,

someone could help me to understand this equations. In particular I don’t understand which variables is Omega in relation to original model’s paper.

You need to be more precise. There are many Gertler/Karadi papers. And whose codes are you using?

Uploading: GK_2011.mod…, this is the code that i’m using for, while these are the two papers, one is the paper model and the last one is an appendix.

GertlerKaradi2011.pdf (527.1 KB)

foerster_appendix2015.pdf (180.4 KB)

The upload did not complete. Who wrote the `GK_2011.mod`

-file?

Then you should try to ask the author of that code. Did you test whether it reproduces the IRFs in the paper?