Hello. Given the model of the attached article, I want to see the effect of technology shock on welfare. How should I code? please help me

Stochastic simulations
1

Ireland5.pdf (308.7 KB)
Hello. Given the model of the attached article, I want to see the effect of technology shock on welfare.
How should I code?
please help me.

2

You need to code the nonlinear FOCs and the steady state. They are given in the Appendix.

3

Hello; Thx for your reply. But I still do not understand how to do the welfare code.

4

You simply need to define the welfare function recursively. See for example https://github.com/JohannesPfeifer/DSGE_mod/blob/master/Born_Pfeifer_2018/Welfare/Born_Pfeifer_2018_welfare.mod