Dear professor, I tried a two-country open economy DSGE model. However, IRFs of some variables in this model can not converge to steady state,such as consumption, labor, price, wage, and so on. I used “model_diagnostics”, but it told me “MODEL_DIAGNOSTICS: No obvious problems with this mod-file we…

See the thread at Large values problem - #6 by jpfeifer With periods=500, you will see the mean reversion.

Thanks a lot professor, With periods=500, all variables in my model can revert to steady state. I have another two questions: First, does “periods=500” mean that the shock in my model has a long-time influence on economy? Second, are there any ways to make these variables revert to steady state e…

Search the forum. [image] Longlasting IRFs Stochastic simulations That is hard to tell. Most of the times, we actually want out model to feature persistence, i.e. endogenous propagation. In a quarterly model, 50 periods is a bit more then 10 years. That can still be consid…

IRFs can not converge to steady state

General DSGE Modeling

jpfeifer 5 July 2022 13:21 4

Search the forum.

comes to mind.