Impossible to find steady state: residuals of the static equations not equal to zero

Steady state
1

Dear professor, I’ve been struggling to run the attached mod-file of a RBC-model thesis.mod (4.7 KB).
The error message is the following:
“error: Impossible to find the steady state (the sum of square residuals
of the static equations is 0.0035). Either the model doesn’t have a stea
dy state, there are an infinity of steady states, or the guess values ar
e too far from the solution”

my residuals of the static equations are not equal to zero, I figured that might be the problem but I’m not sure how to solve this (I am quite new at dynare)

㡣̀Residuals of the static equations:

Equation number 1 : 0 : lambda
Equation number 2 : -0.81601 : phi
Equation number 3 : 1.9704 : 3
Equation number 4 : 0 : r
Equation number 5 : 0.21041 : k
Equation number 6 : 0.09115 : kbar
Equation number 7 : 0.086102 : w_f
Equation number 8 : 0 : w_m
Equation number 9 : 0 : y
Equation number 10 : 0 : l
Equation number 11 : 0 : 11
Equation number 12 : 0 : 12
Equation number 13 : 0 : 13
Equation number 14 : 0 : 14
Equation number 15 : 0 : 15
Equation number 16 : 0 : 16
Equation number 17 : 0 : z
Equation number 18 : 0 : 18
Equation number 19 : 0 : 19
Equation number 20 : 0 : 20
Equation number 21 : 0 : 21
Equation number 22 : 0 : 22
Equation number 23 : 0 : 23
Equation number 24 : 0 : 24
Equation number 25 : 0 : pfi_f
Equation number 26 : 0.43894 : 26

Residuals of the static equations:

Equation number 1 : -0.04019 : lambda
Equation number 2 : -0.013701 : phi
Equation number 3 : 0.035368 : 3
Equation number 4 : 0.0009016 : r
Equation number 5 : 0.0060256 : k
Equation number 6 : 0.001104 : kbar
Equation number 7 : 0.0029137 : w_f
Equation number 8 : -0.00037711 : w_m
Equation number 9 : -0.013041 : y
Equation number 10 : 0.00089867 : l
Equation number 11 : -0.00070889 : 11
Equation number 12 : -0.003228 : 12
Equation number 13 : 0.0013292 : 13
Equation number 14 : 0.014034 : 14
Equation number 15 : 0 : 15
Equation number 16 : 0 : 16
Equation number 17 : 0 : z
Equation number 18 : 0 : 18
Equation number 19 : 0 : 19
Equation number 20 : 0 : 20
Equation number 21 : 0 : 21
Equation number 22 : 0 : 22
Equation number 23 : 0 : 23
Equation number 24 : 0 : 24
Equation number 25 : 0 : pfi_f
Equation number 26 : 0 : 26

2

Recheck your equations. For example, the last one should probably be

log(pfi_m/pfi_m_ss)=rho_pfi_m*log(pfi_m(-1)/pfi_m_ss)+epsilon_pfi_m;
3

I checked all of my equations and they seem right to me…

The equation that you pointed out was correct how I had it
Is there definetly something wrong with my equations or could it be something else that causes this error?

In attachment you can find the equilibrium conditions of the model that I used and how I derived the steady state equations.
equilibrium conditions and steady state.pdf (193.4 KB)

Thank you for your help!! appreciate it a lot :slight_smile:

4
  1. Why do you think your equation was correct? It will imply that pfi_m is not equal to pfi_m_ss in steady state.
  2. If you think your equations are correct, then you need better starting values for steady state finding or even better provide an analytical steady state.