Issues with estimation MCMC method

I have a model as follow. I use GDP as my observable var. (take log and use hpfilter to find cycle and take cycle as varovs). I compute steady state by myself and it’s correct cuz dynare can compute the model.
BUT when I try to estimate parameters like alpha or beta. It can not work.
The following shows the error
Impossible to find the steady state (the sum of square residuals of the static equations
is 0.0003). Either the model doesn’t have a steady state, there are an infinity of
steady states, or the guess values are too far from the solution

index.m (1.6 KB) test.mod (6.6 KB) [datay.mat|attachment]

1 Like
  1. The datafile is missing.
  2. Please use a steady_state_model-block for your analytical steady state.
  3. Your observable is non-mean 0 in the model, but mean 0 in the data. You need to specify a proper observation equation. See Pfeifer(2013): “A Guide to Specifying Observation Equations for the Estimation of DSGE Models” .
  4. See

Thank you sir, Finally I can do estimate for my model.
I have one more question. How to choose calibration and estimation? What kind of parameters should I calibrate and what kind of parameters should I estimate.


Thanks very much Professor Pfeifer.