Hi everydody, please see if someone could help me on this:
After using shock_decomposition, I can see that the influence of initial values on some of my endogenous variables are very persistent, even after a long period. (Also, some of IRF take a long time to converge to long run values).
I am confused about those results. Is there anything I should worry about? It seems I dont have unit root problems, as Blanchard and Kahn conditions are satisfied and numerical steady-state convergence is achieved.
Best Regards,
Nottar