# Help with dynare, SS block not working, perhaps sth wrong with code

I don’t know what is going with my code.

I was given a fully functional code, but then i’m required to modify it. Precisely I’m asked to break with one price law (P=SP*) and substitute it with a Calvo pricing rigidity so I’m asked to take away this equation:

exp(p_F)=exp(rer)

and substitute it for these:

``````exp(p_F)*exp(mc_F)=exp(rer); //32
exp(f1F)=exp(p_tilde_F)^(1-EPSILON_F)*exp(y_ast)*(EPSILON_F-1)/EPSILON_F+THETA_F*BETA*exp(la(+1))/exp(la)/exp(ppi(+1))*(exp(p_tilde_F)*exp(ppi)/exp(p_tilde_F(+1)))^(1-EPSILON_F)*exp(ppi_F(+1))^(EPSILON_F)*exp(f1F(+1)); //33
exp(f2H)=exp(p_tilde_F)^(-EPSILON_F)*exp(y_ast)*exp(mc_F)+THETA_F*BETA*exp(la(+1))/exp(la)/exp(ppi(+1))*(exp(p_tilde_F)*exp(ppi)/exp(p_tilde_F(+1)))^(-EPSILON_F) *exp(ppi_F(+1))^(EPSILON_F+1)*exp(f2F(+1)); //34
exp(f1F)=exp(f2F); //35
1=THETA_F*(exp(ppi_H)/exp(ppi(-1)))^(EPSILON_H-1)+(1-THETA_F)*exp(p_tilde_F)^(1-EPSILON_F); //36
exp(p_F)/exp(p_F(-1))=exp(ppi_F)/exp(ppi); //E37
``````

I carefully added f1F f2F p_tilde_F ppi_F mc_F as variables (took away 1 eq, added 6 and added 5 variables) and the parameters EPSILON_F and THETA_F.

Finally in the SS block I wrote:

``````ppi_F_ss=ppi_ss;
mc_F_ss=(EPSILON_F-1)/EPSILON_F;
rer_ss=mc_F_ss*p_F_ss;
p_tilde_F_ss=1;
f1F_ss=p_tilde_F_ss^(-EPSILON_F)/(1-THETA_F*BETA)*y_ast_ss*mc_F_ss;
f2F_ss=f1F_ss;
``````

But dynare keeps saying that rer_ss is not defined when I clearly defined above as:
rer_ss=mc_F_ss*p_F_ss;

Sorry if I haven’t met the format the forum is expected to met. First time here.

1. Please provide the full file
2. Only do exp()-substitutions once the model runs.
3. https://github.com/JohannesPfeifer/DSGE_mod/blob/master/Gali_2015/Derivation_Recursive_Pricing_Equation.pdf and the mod-files accompanying it may be helpful.

Hi jpfeifer, I send you the code.Calvo.mod (8.9 KB)

The problem is now that the steady state doen’t compute the SS, however the residuals are 0 (almost all)

1. Again

Even better, use auxiliary variables. See Question about understanding irfs in dynare - #4 by jpfeifer
2. You need to find out whether the problem is your steady state computations or whether there is still a mistake in the model equations.