# Identification problem. Seems my two shocks are collinear

Hello Dynare Community,

I’m trying to replicate the model and results in Ferroni (2011) “Trend agnostic one-step estimation of DSGE Models” that appear in the section 1 (Introduction) based in Chang, Doh, and Schorfheide (2007). Since the model includes trends in the observed variables, I include two observation equations. But I’m having problems in the estimation as this results are shown along the identification command (I include the rest of the log file as attachment):

==== Identification analysis ====

Testing prior mean
The number of moments with non-zero derivative is smaller than the number of parameters
Try increasing ar = 2
warning: division by zero
warning: called from
lyapunov_symm at line 172 column 12
getJJ at line 59 column 9
identification_analysis at line 92 column 38
dynare_identification at line 280 column 93
Ferroni_2 at line 178 column 1
dynare at line 180 column 1
warning: division by zero
warning: division by zero
warning: division by zero
warning: division by zero
warning: division by zero
warning: division by zero
The number of moments with non-zero derivative is smaller than the number of parameters
Try increasing ar = 3
warning: division by zero
warning: division by zero
warning: division by zero
warning: division by zero
warning: division by zero
warning: division by zero
warning: division by zero
The number of moments with non-zero derivative is smaller than the number of parameters
… This continues up to ar=10
up to 10 lags: check your model
Either further increase ar or reduce the list of estimated parameters
error: IDETooManyParams
error: called from:
error: c:\dynare\4.4.3\matlab\identification_analysis.m at line 102, column 13
error: c:\dynare\4.4.3\matlab\dynare_identification.m at line 280, column 93
error: C:\Users\USR_PracticanteGT42\Documents\Programacion\true_model\Ferroni_2.m at line 178, colu
mn 1
error: c:\dynare\4.4.3\matlab\dynare.m at line 180, column 1

I tried writing the log-linearized model in Dynare, but the same problem and the same errors appear.

What could be the source of this? How can I solve it?