Hey guys!

I am writing a dynare code following Gertler and Karadi’s paper “A model of unconventional monetary policy”. I want to introduce a credit policy shock but the code cannot run!

The problem is:

"Error: File: GK_creditpolicy2018.m Line: 416 Column: 18

Unexpected MATLAB expression.

Error in dynare (line 223)

evalin(‘base’,fname) ;"

GK_creditpolicy2018.mod (9.8 KB)

I cannot find the errors! Would anyone help me?

I post the code here…

Thank you in advance!

```
title('Household's consumption')
```

needs to be

```
title('Household''s consumption')
```

to be recognized as a string in Matlab

Thank you professor! Now the error is:

**"Error using print_info (line 83)**

**Impossible to find the steady state. Either the model doesn’t have a steady state, there are an infinity of**

**steady states, or the guess values are too far from the solution**

**Error in check (line 76)**

** print_info(info, 0, options);**

**Error in GK_creditpolicy2018 (line 386)**

**oo_.dr.eigval = check(M_,options_,oo_);**

**Error in dynare (line 223)**

**evalin(‘base’,fname) ;"**

What is wrong in your opinion? Thanks for the attention!

You need to find out why your changes imply that the steady state cannot be found.

Thank you professor!

Now I changed some equations and I added the initval block!

The error now is:

"Error using print_info (line 37)

The generalized Schur (QZ) decomposition failed. For more information, see the documentation for Lapack function

dgges: info=28, n=26. You can also run model_diagnostics to get more information on what may cause this problem.

Error in check (line 76)

print_info(info, 0, options);

Error in PROVA (line 491)

oo_.dr.eigval = check(M_,options_,oo_);

Error in dynare (line 223)

evalin(‘base’,fname) ; "

What is wrong now? I post, as usually, the code…PROVA.mod (10.7 KB)

`model_diagnostics`

returns

```
MODEL_DIAGNOSTICS: The Jacobian of the static model is singular
MODEL_DIAGNOSTICS: there is 1 colinear relationships between the variables and the equations
Colinear variables:
psi
Colinear equations
32 36
```

The equation

```
psi = psi+kap*(Rk(+1)-R-SPRSS)+shockpsi;
```

is strange, because it implies

```
0 = kap*(Rk(+1)-R-SPRSS)+shockpsi;
```

i.e. the `psi`

drops out.

Hi everyone! I’m still working on Gertler and Karadi paper…

Now I’m trying to study this model with EU calibration. Now I have a problem: the residual of equation 21 is not zero and I don’t understand why.

I attach the code here…Could anyone help me?

Thank you in advanceGK18EU.mod (10.2 KB)

```
gov = 0.215; % government spending over GDP
```

seems to be inconsistent with

```
GSS = 0.38; % ... government spending
```