In order to make a Bayesian estimation I need to add two preference shocks to a Cobb Douglas utility function
Where chi and eta are intertemporal and intratemporal preference shocks, L is labor, 1-L is leasure, C consumption. Anyone can suggest me any paper or Dynare example of this? I am having many troubles getting a correct dynare implementation of it in log-linearized form.
Would someone be able to provide sample dynare code for log-linearization of the first order conditions (for consumption and labor) for these preferences! Thank you sooo much in advance!