Hello,

I wonder if it is possible to define a Macro-variable to equal to a parameter. Something like

parameters sig_c;

sig_c=1;

@#define sig_c_par=sig_c

I am trying to estimate a model using Dynare. My model has a CRRA utility function, so the model equation of the utility function will be

U= c^(1-sig_c) / (1-sig_c) or U= log(c), depending on the intertemporal elasticity of substitution sig_c. I want to bayesian estimate sig_c, and I wonder how to tell dynare to use the equation U=log(c) when sig_c=1. I have tried the following code, but got the error msg ’ ERROR in macro-processor … Unknown variable: sig_c’.

parameters sig_c;

sig_c=1;

@#define sig_c_par=sig_c

…

model;

@#if sig_c_par==1

U=log(c);

@#else

U= c^(1-sig_c) / (1-sig_c);

@#endif

…

end;

Does anyone have a suggestion how to solve the problem? Any help will be much appreciated!