I’m trying to replicate Curdia, Chen and Ferrero’s (2012) paper (Link to the paper: frbsf.org/economic-research/files/wp12-22bk.pdf; link to technical appendix: onlinelibrary.wiley.com/store/10.1111/j.1468-0297.2012.02549.x/asset/supinfo/ecoj2549_sm_Appendix.pdf?v=1&s=cab4f91ddeddf4ae873c6bfcd9aa56f81a9ef087 (if you cannot access this, I can also upload it)).
However, I’m getting that the BK conditions are not satisfied, more specifically:
Error using print_info (line 43)
Blanchard Kahn conditions are not satisfied: indeterminacy
Error in stoch_simul (line 81)
Error in ccf (line 565)
info = stoch_simul(var_list_);
Error in dynare (line 120)
I have checked and rechecked my equations, but I still can’t figure out what’s going on. Can someone please help? I’m uploading the code.
Many thanks in advance,
ccf.mod (9.7 KB)