Issues replicating Galí (2007) (Heterogenous agents & Government spending)

Dear all,

We are trying to replicate the 2007 paper by Galí, Vallés & López-Salido, “Understanding the effects of government consumption on consumption”, which seeks to model the possible crowding-in effects from government spending shocks on private consumption.
Modelling the authors’ case for perfect labor markets, we seem to find results relatively close to those of the original paper.
However, it seems the model becomes unstable (Blanchard-Kahn conditions not verified) when we try to estimate the case for imperfect labor markets. We found this thread, where someone else seemed to have the same issue.
The crowding-in effects from the government spending shock are greatly affected by the labor market-situation, and relatively non-existent for the perfect labor markets. We are in relatively dire need of getting the imperfect labor markets-case to work for our project, and it can hardly be a mistake on Galí’s side? Their results for the imperfect case are super relevant for us, but we are simply not able to recreate them.
Are anyone aware of this issue or have managed to solve it?

Thanks a lot in advance!

Our code:
Gali_2007_v2.mod (2.8 KB)

I provided you with replication files. They should allow to reproduce the non-competitive labor market.

Hi Johannes. Is it possible to share the replication files?

I sent it to you via PM.

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Thanks a lot. Appreciate it.

Thanks a lot!
We also found minor errors and made our linearized version of the model work. Here it is for future reference: Gali_2007.mod (2.5 KB)

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Hi Johannes,

Is it possible to share the replication files? Best

Dear mr. Pfeifer, would you be so kind and send the files to me aswell? Thanks

Hello Johannes, would you be able to send me the replication file as well? I’m trying to replicate Gali et. al. (2007) :slight_smile:

Hi Johannes, could you also send me the replication file, please? Thank you very much in advance.

Hello, Johannes I am trying to replicate Gali et al. (2007), could you or anyone with the replication file available, be so kind to share it with me? Thank you so much in advanced.

Hello Johannes, I am wondering if you could kindly share the replication codes with me as well? I couldn’t find them anywhere on your GitHub. Thank you very much in advanced.

Could you also send me the replication file, please? I’m having problems with the consumption share. I can’t obtain the equation in the Appendix B: Steady State Analysis. Also in this Gali et al (2007): Consumption SS-Share - #3 by jpfeifer they said that equation is flawed.

Hello Johannes, I am struggling to replicate Gali et al. (2007) as well and your replication file would be really helpful. Could you please send it to me ?

Thank you in advance !

Hello Johannes,

May you send the this code to me as well ?



Professor could you please share the code for Gali et al (2007) with me as well?