Hi! I am new to dynare. I am trying to replicate Sahminan et al. (2017). But am getting a message:

Starting preprocessing of the model file …

Found 16 equation(s).

Evaluating expressions…done

Computing static model derivatives:

- order 1

Computing dynamic model derivatives: - order 1
- order 2

Processing outputs …

done

Preprocessing completed.

STEADY-STATE RESULTS:

c 0

piH 0

mc 0

kg 0

s 0

i 0

y 0

n 0

nx 0

gI 0

gc 0

pH 0

pi 0

p 0

e 0

a 0

EIGENVALUES:

Modulus Real Imaginary

```
1.8e-16 1.8e-16 0
0.3436 0.3436 0
0.75 0.75 0
0.75 0.75 0
0.975 0.975 0
1 1 0
1 1 0
1 1 0
1 1 0
1.274 1.274 0
1.731 1.731 0
```

A_DYNAMIC_STOCHASTIC_GENERAL_EQUILIBRIUM_DSGE_MODE.pdf (2.3 MB)

There are 2 eigenvalue(s) larger than 1 in modulus

for 2 forward-looking variable(s)

Where am I going wrong?

Thank you in advance.

trial2004.mod (1.6 KB)